MEDIAONE GROUP FUNDING, INC.,
Issuer
U S WEST, INC.
(to be renamed "MEDIAONE GROUP, INC.")
Guarantor
AND
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
Trustee
-----------------------------
INDENTURE
Dated as of June 12, 1998
-----------------------------
Guaranteed Subordinated Debt Securities
CROSS-REFERENCE TABLE (*)
Section of
Trust Indenture Act Section of
of 1939, as amended Indenture
------------------- ----------
310(a) . . . . . . . . . . . . . . . . . . . . . . . . 7.09
310(b) . . . . . . . . . . . . . . . . . . . . . . . . 7.08
7.10
310(c) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . . . . . . . . 7.13(a)
311(b) . . . . . . . . . . . . . . . . . . . . . . . . 7.13(b)
311(c) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . . . . . . . . 5.01
5.02(a)
312(b) . . . . . . . . . . . . . . . . . . . . . . . . 5.02(b)
312(c) . . . . . . . . . . . . . . . . . . . . . . . . 5.02(c)
313(a) . . . . . . . . . . . . . . . . . . . . . . . . 5.04(a)
313(b) . . . . . . . . . . . . . . . . . . . . . . . . 5.04(b)
313(c) . . . . . . . . . . . . . . . . . . . . . . . . 5.04(a)
5.04(b)
313(d) . . . . . . . . . . . . . . . . . . . . . . . . 5.04(c)
314(a) . . . . . . . . . . . . . . . . . . . . . . . . 5.03
314(b) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(c) . . . . . . . . . . . . . . . . . . . . . . . . 13.06
314(d) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(e) . . . . . . . . . . . . . . . . . . . . . . . . 13.06
314(f) . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
315(a) . . . . . . . . . . . . . . . . . . . . . . . . 7.01(a)
7.02
315(b) . . . . . . . . . . . . . . . . . . . . . . . . 6.07
315(c) . . . . . . . . . . . . . . . . . . . . . . . . 7.01
315(d) . . . . . . . . . . . . . . . . . . . . . . . . 7.01(b)
7.01(c)
315(e) . . . . . . . . . . . . . . . . . . . . . . . . 6.07
316(a) . . . . . . . . . . . . . . . . . . . . . . . . 6.06
8.04
316(b) . . . . . . . . . . . . . . . . . . . . . . . . 6.04
316(c) . . . . . . . . . . . . . . . . . . . . . . . . 8.01
317(a) . . . . . . . . . . . . . . . . . . . . . . . . 6.02
317(b) . . . . . . . . . . . . . . . . . . . . . . . . 4.03
318(a) . . . . . . . . . . . . . . . . . . . . . . . . 13.08
-------------------
(*) This Cross-Reference Table does not constitute part of the Indenture and
shall not have any bearing on the interpretation of any of its terms or
provisions.
TABLE OF CONTENTS (*)
PAGE
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PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITALS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I.
DEFINITIONS
SECTION 1.01. Definitions of Terms . . . . . . . . . . . . . . . . . 1
Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent. . . . . . . . . . . . . . . . . . . . . . . . . 2
Bankruptcy Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board of Directors. . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board Resolution. . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Business Day. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Common Securities . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Corporate Trust Office. . . . . . . . . . . . . . . . . . . . . . . . 3
Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Declaration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Debt Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Depositary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Event of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Global Security . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Governmental Obligations. . . . . . . . . . . . . . . . . . . . . . . 4
Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Guarantor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
"herein", "hereof" and "hereunder . . . . . . . . . . . . . . . . . . 5
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Interest Payment Date . . . . . . . . . . . . . . . . . . . . . . . . 5
Officers' Certificate . . . . . . . . . . . . . . . . . . . . . . . . 5
Opinion of Counsel. . . . . . . . . . . . . . . . . . . . . . . . . . 5
Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Person. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Predecessor Security. . . . . . . . . . . . . . . . . . . . . . . . . 6
Preferred Securities. . . . . . . . . . . . . . . . . . . . . . . . . 6
Preferred Securities Guarantee. . . . . . . . . . . . . . . . . . . . 6
Property Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Responsible Officer . . . . . . . . . . . . . . . . . . . . . . . . . 6
-------------------
(*) This Table of Contents does not constitute part of the Indenture and shall
not have any bearing upon the interpretation of any of its terms or
provisions.
i
PAGE
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Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Securityholder. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Subsidiary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trust Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . 7
MediaOne Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Voting Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE II.
ISSUE, DESCRIPTION, TERMS, EXECUTION,
REGISTRATION AND EXCHANGE OF SECURITIES
SECTION 2.01. Designation and Terms of Securities. . . . . . . . 8
SECTION 2.02. Form of Securities and Trustee's Certificate . . . 10
SECTION 2.03. Denominations: Provisions for Payment . . . . . . 10
SECTION 2.04. Execution and Authentications. . . . . . . . . . . 13
SECTION 2.05. Registration of Transfer and Exchange. . . . . . . 14
SECTION 2.06. Temporary Securities . . . . . . . . . . . . . . . 15
SECTION 2.07. Mutilated, Destroyed, Lost or Stolen Securities. . 16
SECTION 2.08. Cancellation . . . . . . . . . . . . . . . . . . . 17
SECTION 2.09. Benefits of Indenture. . . . . . . . . . . . . . . 17
SECTION 2.10. Authenticating Agent . . . . . . . . . . . . . . . 18
SECTION 2.11. Global Securities. . . . . . . . . . . . . . . . . 18
SECTION 2.12. Unconditional Guarantees . . . . . . . . . . . . . 20
SECTION 2.13. Execution of Guarantee . . . . . . . . . . . . . . 21
SECTION 2.14. Assumption by Guarantor. . . . . . . . . . . . . . 22
ARTICLE III.
REDEMPTION OF DEBT SECURITIES AND SINKING FUND PROVISIONS
SECTION 3.01. Redemption . . . . . . . . . . . . . . . . . . . . 22
SECTION 3.02. Notice of Redemption . . . . . . . . . . . . . . . 23
SECTION 3.03. Payment Upon Redemption. . . . . . . . . . . . . . 24
SECTION 3.04. Sinking Fund . . . . . . . . . . . . . . . . . . . 25
SECTION 3.05. Satisfaction of Sinking Fund Payments with
Debt Securities. . . . . . . . . . . . . . . . . . 25
SECTION 3.06. Redemption of Debt Securities for Sinking Fund . . 26
ARTICLE IV.
SECTION 4.01. Payment of Principal, Premium and Interest . . . . 26
ii
PAGE
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SECTION 4.02. Maintenance of Office or Agency. . . . . . . . . . 26
SECTION 4.03. Paying Agents. . . . . . . . . . . . . . . . . . . 27
SECTION 4.04. Appointment to Fill Vacancy in Office of Trustee . 28
SECTION 4.05. Compliance with Consolidation Provisions . . . . . 28
SECTION 4.06. Limitation on Dividends; Transactions with
Affiliates . . . . . . . . . . . . . . . . . . . . 29
SECTION 4.07. Covenants as to MediaOne Trusts. . . . . . . . . . 29
ARTICLE V.
SECURITYHOLDERS' LISTS AND REPORTS
BY THE COMPANY AND THE TRUSTEE
SECTION 5.01. Company to Furnish Trustee Names and Addresses of
Securityholders. . . . . . . . . . . . . . . . . . 30
SECTION 5.02. Preservation Of Information; Communications With
Securityholders. . . . . . . . . . . . . . . . . . 30
SECTION 5.03. Reports by the Guarantor . . . . . . . . . . . . . 31
SECTION 5.04. Reports by the Trustee . . . . . . . . . . . . . . 31
ARTICLE VI.
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 6.01. Events of Default. . . . . . . . . . . . . . . . . 32
SECTION 6.02. Collection of Indebtedness and Suits for
Enforcement by Trustee . . . . . . . . . . . . . . 35
SECTION 6.03. Application of Moneys Collected. . . . . . . . . . 37
SECTION 6.04. Limitation on Suits. . . . . . . . . . . . . . . . 37
SECTION 6.05. Rights and Remedies Cumulative; Delay or Omission
Not Waiver . . . . . . . . . . . . . . . . . . . . 38
SECTION 6.06. Control by Securityholders . . . . . . . . . . . . 39
SECTION 6.07. Undertaking to Pay Costs . . . . . . . . . . . . . 39
ARTICLE VII.
CONCERNING THE TRUSTEE
SECTION 7.01. Certain Duties and Responsibilities of Trustee . . 40
SECTION 7.02. Certain Rights of Trustee. . . . . . . . . . . . . 42
SECTION 7.03. Trustee Not Responsible for Recitals or Issuance or
Securities . . . . . . . . . . . . . . . . . . . . 43
SECTION 7.04. May Hold Securities. . . . . . . . . . . . . . . . 44
iii
PAGE
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SECTION 7.05. Moneys Held in Trust . . . . . . . . . . . . . . . 44
SECTION 7.06. Compensation and Reimbursement . . . . . . . . . . 44
SECTION 7.07. Reliance on Officers' Certificate. . . . . . . . . 45
SECTION 7.08. Disqualification; Conflicting Interests. . . . . . 45
SECTION 7.09. Corporate Trustee Required; Eligibility. . . . . . 45
SECTION 7.10. Resignation and Removal; Appointment of Successor. 46
SECTION 7.11. Acceptance of Appointment By Successor . . . . . . 48
SECTION 7.12. Merger, Conversion, Consolidation or Succession
to Business. . . . . . . . . . . . . . . . . . . . 49
SECTION 7.13. Preferential Collection of Claims Against the Company 50
ARTICLE VIII.
CONCERNING THE SECURITYHOLDERS
SECTION 8.01. Evidence of Action by Securityholders. . . . . . . 50
SECTION 8.02. Proof of Execution by Securityholders. . . . . . . 51
SECTION 8.03. Who May be Deemed Owners . . . . . . . . . . . . . 51
SECTION 8.04. Certain Securities Owned by Company or Guarantor
Disregarded. . . . . . . . . . . . . . . . . . . . 52
SECTION 8.05. Actions Binding on Future Securityholders. . . . . 52
ARTICLE IX.
SUPPLEMENTAL INDENTURES
SECTION 9.01. Supplemental Indentures Without the Consent of
Securityholders. . . . . . . . . . . . . . . . . . 53
SECTION 9.02. Supplemental Indentures With Consent of
Securityholders. . . . . . . . . . . . . . . . . . 54
SECTION 9.03. Effect of Supplemental Indentures. . . . . . . . . 55
SECTION 9.04. Securities Affected by Supplemental Indentures . . 55
SECTION 9.05. Execution of Supplemental Indentures . . . . . . . 55
iv
PAGE
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ARTICLE X.
SUCCESSOR CORPORATION
SECTION 10.01. Company or Guarantor May Consolidate, Etc. . . . . 56
SECTION 10.02. Successor Corporation Substituted. . . . . . . . . 57
SECTION 10.03. Evidence of Consolidation, Etc. to Trustee . . . . 58
ARTICLE XI.
SATISFACTION AND DISCHARGE
SECTION 11.01. Satisfaction and Discharge of Indenture. . . . . . 58
SECTION 11.02. Discharge of Obligations . . . . . . . . . . . . . 59
SECTION 11.03. Deposited Moneys to be Held in Trust . . . . . . . 59
SECTION 11.04. Payment of Moneys Held by Paying Agents. . . . . . 60
SECTION 11.05. Repayment to Company . . . . . . . . . . . . . . . 60
ARTICLE XII.
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS
SECTION 12.01. No Recourse. . . . . . . . . . . . . . . . . . . . 60
ARTICLE XIII.
MISCELLANEOUS PROVISIONS
SECTION 13.01. Effect on Successors and Assigns . . . . . . . . . 61
SECTION 13.02. Actions by Successor . . . . . . . . . . . . . . . 61
SECTION 13.03. Surrender of Company Powers. . . . . . . . . . . . 62
SECTION 13.04. Notices. . . . . . . . . . . . . . . . . . . . . . 62
SECTION 13.05. Governing Law. . . . . . . . . . . . . . . . . . . 62
SECTION 13.06. Treatment of Debt Securities as Debt . . . . . . . 62
SECTION 13.07. Compliance Certificates and Opinions . . . . . . . 62
SECTION 13.08. Payments on Business Days. . . . . . . . . . . . . 63
SECTION 13.09. Conflict with Trust Indenture Act. . . . . . . . . 63
SECTION 13.10. Counterparts . . . . . . . . . . . . . . . . . . . 63
SECTION 13.11. Separability . . . . . . . . . . . . . . . . . . . 64
SECTION 13.12. Assignment . . . . . . . . . . . . . . . . . . . . 64
SECTION 13.13. Acknowledgement of Rights. . . . . . . . . . . . . 64
v
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ARTICLE XIV.
SUBORDINATION OF SECURITIES
SECTION 14.01. Subordination Terms. . . . . . . . . . . . . . . . 65
vi
INDENTURE, dated as of June 12, 1998, among MediaOne Group Funding,
Inc., a Delaware corporation (the "Company"), U S WEST, Inc., a Delaware
corporation to be renamed "MediaOne Group, Inc." (the "Guarantor"), and
Norwest Bank Minnesota, National Association, a national banking association,
as trustee (the "Trustee"):
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuance of unsecured subordinated debt secu-rities (hereinafter referred to
as the "Debt Securities"), in an unlimited aggregate principal amount to be
issued from time to time in one or more series as in this Indenture provided,
as registered Debt Securities without coupons, to be authenticated by the
certificate of the Trustee;
WHEREAS, for its lawful corporate purposes, the Guarantor has duly
authorized the execution and delivery of this Indenture and deems it
appropriate from time to time to issue its guarantee of the Securities on the
terms herein provided (the "Guarantees" and, together with the Debt
Securities, the "Securities");
WHEREAS, to provide the terms and conditions upon which the Debt
Securities are to be authenticated, issued and delivered, the Company has
duly authorized the execution of this Indenture; and
WHEREAS, all things necessary to make this Indenture a valid
agreement of the Company and the Guarantor, in accordance with its terms,
have been done.
NOW, THEREFORE, in consideration of the premises and the purchase of
the Securities by the holders thereof, it is mutually covenanted and agreed
as follows for the equal and ratable benefit of the holders of Securities:
ARTICLE I.
DEFINITIONS
SECTION 1.01. DEFINITIONS OF TERMS.
The terms defined in this Section (except as in this Indenture
otherwise expressly provided or unless the context otherwise requires) for
all purposes of this Indenture and of any indenture supplemental hereto shall
have the respective meanings
specified in this Section and shall include the plural as well as the
singular. All other terms used in this Indenture that are defined in the
Trust Indenture Act of 1939, as amended, or that are by reference in such Act
defined in the Securities Act of 1933, as amended (except as herein otherwise
expressly provided or unless the context otherwise requires), shall have the
meanings assigned to such terms in said Trust Indenture Act and in said
Securities Act as in force at the date of the execution of this instrument.
"Affiliate" means, with respect to a specified Person, (a) any
Person directly or indirectly owning, controlling or holding with power to
vote 10% or more of the outstanding voting securities or other ownership
interests of the specified Person, (b) any Person 10% or more of whose
outstanding voting securities or other ownership interests are directly or
indirectly owned, controlled or held with power to vote by the specified
Person, (c) any Person directly or indirectly controlling, controlled by, or
under common control with the specified Person, (d) a partnership in which
the specified Person is a general partner, (e) any officer or director of the
specified Person, and (f) if the specified Person is an individual, any
entity of which the specified Person is an officer, director or general
partner.
"Authenticating Agent" means an authenticating agent with respect to
all or any of the series of Securities appointed with respect to all or any
series of the Securities by the Trustee pursuant to Section 2.10.
"Bankruptcy Law" means Title 11, U.S. Code, or any similar federal
or state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company or
the Guarantor, as the case may be, or any duly authorized committee of such
Board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company or Guarantor, as the case
may be, to have been duly adopted by the Board of Directors and to be in full
force and effect on the date of such certification.
"Business Day" means, with respect to any series of Securities, any
day other than a day on which Federal or State banking institutions in the
Borough of Manhattan, The City of New York, are authorized or obligated by
law, executive order or regulation to close.
2
"Certificate" means a certificate signed by the principal executive
officer, the principal financial officer or the principal accounting officer
of the Company or the Guarantor, as the case may be. The Certificate need
not comply with the provisions of Section 13.06.
"Common Securities" means undivided beneficial interests in the
assets of a MediaOne Trust which rank pari passu with Preferred Securities
issued by such MediaOne Trust; PROVIDED, HOWEVER, that upon the occurrence of
an Event of Default, the rights of holders of Common Securities to payment in
respect of distributions and payments upon liquidation, redemption and
otherwise are subordinated to the rights of holders of Preferred Securities.
"Common Securities Guarantee" means any guarantee that the Guarantor
may enter into with The First National Bank of Chicago or other Persons that
operate directly or indirectly for the benefit of holders of Common
Securities of such MediaOne Trust.
"Company" means MediaOne Group Funding, Inc., a corporation duly
organized and existing under the laws of the State of Delaware, and, subject
to the provisions of Article Ten, shall also include its successors and
assigns.
"Corporate Trust Office" means the office of the Trustee at which,
at any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at ▇▇▇ ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate
Trust Services Division, except that whenever a provision herein refers to an
office or agency of the Trustee in the Borough of Manhattan, The City of New
York, such office is located, at the date hereof, at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
"Custodian" means any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.
"Declaration", with respect to a MediaOne Trust, means the Amended
and Restated Declaration of Trust of such MediaOne Trust.
"Debt Securities" means the Debt Securities authenticated and
delivered under this Indenture.
3
"Default" means any event, act or condition that with notice or
lapse of time, or both, would constitute an Event of Default.
"Depositary" means, with respect to Securities of any series, for
which the Company shall determine that such Securities will be issued as a
Global Security, The Depository Trust Company, New York, New York, another
clearing agency, or any successor registered as a clearing agency under the
Securities and Exchange Act of 1934, as amended (the "Exchange Act"), or
other applicable statute or regulation, which, in each case, shall be
designated by the Company pursuant to either Section 2.01 or 2.11.
"Event of Default" means, with respect to Securities of a particular
series any event specified in Section 6.01, continued for the period of time,
if any, therein designated.
"Global Security" means, with respect to any series of Securities, a
Security executed by the Company and delivered by the Trustee to the
Depositary or pursuant to the Depositary's instruction, all in accordance
with the Indenture, which shall be registered in the name of the Depositary
or its nominee.
"Governmental Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America, the payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America that, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depositary receipt issued by a bank (as defined in
Section 3(a)(2) of the Securities Act of 1933, as amended) as custodian with
respect to any such Governmental Obligation or a specific payment of
principal of or interest on any such Governmental Obligation held by such
custodian for the account of the holder of such depositary receipt; PROVIDED,
HOWEVER, that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depositary
receipt from any amount received by the custodian in respect of the
Governmental Obligation or the specific payment of principal of or interest
on the Governmental Obligation evidenced by such depositary receipt.
"Guarantee" means the agreement of the Guarantor, in the form set
forth in Section 2.12 hereof, to be endorsed on the Debt Securities
authenticated and delivered under this Indenture.
4
"Guarantor" means U S WEST, Inc., a corporation duly organized and
existing under the laws of the State of Delaware to be renamed "MediaOne
Group, Inc.," and, subject to the provisions of Article Ten, shall also
include its successors and assigns.
"herein", "hereof" and "hereunder", and other words of similar
import, refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
"Indenture" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into in accordance with the terms hereof.
"Interest Payment Date", when used with respect to any installment
of interest on a Debt Security of a particular series, means the date
specified in such Debt Security or in a Board Resolution or in an indenture
supplemental hereto with respect to such series as the fixed date on which an
installment of interest with respect to Debt Securities of that series is due
and payable.
"Officers' Certificate" means a certificate signed by the President
or a Vice President and by the Treasurer or an Assistant Treasurer or the
Controller or an Assistant Controller or the Secretary or an Assistant
Secretary of the Company or the Guarantor, as the case may be, that is
delivered to the Trustee in accordance with the terms hereof. Each such
certificate shall include the statements provided for in Section 13.06, if
and to the extent required by the provisions thereof.
"Opinion of Counsel" means an opinion in writing of legal counsel,
who may be an employee of or counsel for the Company or the Guarantor, as the
case may be, that is delivered to the Trustee in accordance with the terms
hereof. Each such opinion shall include the statements provided for in
Section 13.06, if and to the extent required by the provisions thereof.
"Outstanding", when used with reference to Debt Securities of any
series, means, subject to the provisions of Section 8.04, as of any
particular time, all Debt Securities of that series theretofore authenticated
and delivered by the Trustee under this Indenture, except (a) Debt Securities
theretofore canceled by the Trustee or any paying agent, or delivered to the
Trustee or any paying agent for cancellation or that have previously been
canceled; (b) Debt Securities or portions thereof for the payment or
redemption of which moneys or Governmental Obligations in the necessary
amount shall have been
5
deposited in trust with the Trustee or with any paying agent (other than the
Company) or shall have been set aside and segregated in trust by the Company
(if the Company shall act as its own paying agent); PROVIDED, HOWEVER, that
if such Debt Securities or portions of such Debt Securities are to be
redeemed prior to the maturity thereof, notice of such redemption shall have
been given as in Article Three provided, or provision satisfactory to the
Trustee shall have been made for giving such notice; and (c) Debt Securities
in lieu of or in substitution for which other Debt Securities shall have been
authenticated and delivered pursuant to the terms of Section 2.07.
"Person" means any individual, corporation, partnership,
joint-venture, joint-stock company, unincorporated organization or government
or any agency or political subdivision thereof.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt and guarantee
as that evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 2.07 in
lieu of a lost, destroyed or stolen Security shall be deemed to evidence the
same debt as the lost, destroyed or stolen Security.
"Preferred Securities" means undivided beneficial interests in the
assets of a MediaOne Trust which rank pari passu with Common Securities
issued by such MediaOne Trust; PROVIDED, HOWEVER, that upon the occurrence of
an Event of Default, the rights of holders of Common Securities to payment in
respect of distributions and payments upon liquidation, redemption and
otherwise are subordinated to the rights of holders of Preferred Securities.
"Preferred Securities Guarantee" means any guarantee that the
Guarantor may enter into with The First National Bank of Chicago or other
Persons that operate directly or indirectly for the benefit of holders of
Preferred Securities of such MediaOne Trust.
"Property Trustee" means the entity performing the functions of the
Property Trustee of a MediaOne Trust under the applicable Declaration of such
MediaOne Trust.
"Responsible Officer" when used with respect to the Trustee means
the Chairman of the Board of Directors, the President, any Vice President,
the Secretary, the Treasurer, any trust officer, any corporate trust officer
or any other officer
6
or assistant officer of the Trustee customarily performing functions similar
to those performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of
his or her knowledge of and familiarity with the particular subject.
"Securities" means any Debt Securities with a Guarantee endorsed
thereon.
"Securityholder", "holder of Securities", "registered holder", or
other similar term, means the Person or Persons in whose name or names a
particular Security shall be registered on the books of the Company kept for
that purpose in accordance with the terms of this Indenture.
"Subsidiary" means, with respect to any Person, (i) any corporation
at least a majority of whose outstanding Voting Stock shall at the time be
owned, directly or indirectly, by such Person or by one or more of its
Subsidiaries or by such Person and one or more of its Subsidiaries, (ii) any
general partnership, joint venture or similar entity, at least a majority of
whose outstanding partnership or similar interests shall at the time be owned
by such Person, or by one or more of its Subsidiaries, or by such Person and
one or more of its Subsidiaries and (iii) any limited partnership of which
such Person or any of its Subsidiaries is a general partner.
"Trustee" means Norwest Bank Minnesota, National Association, and,
subject to the provisions of Article Seven, shall also include its successors
and assigns, and, if at any time there is more than one Person acting in such
capacity hereunder, "Trustee" shall mean each such Person. The term
"Trustee" as used with respect to a particular series of the Securities shall
mean the trustee with respect to that series.
"Trust Indenture Act", means the Trust Indenture, subject to the
provisions of Sections 9.01, 9.02, and 10.01, as in effect at the date of
execution of this instrument.
"Trust Securities" means Common Securities and Preferred Securities.
"MediaOne Trust" means each of MediaOne Finance Trust I, MediaOne
Finance Trust II and MediaOne Finance Trust III, each, a Delaware business
trust.
"Voting Stock", as applied to stock of any Person, means shares,
interests, participations or other equivalents in
7
the equity interest (however designated) in such Person having ordinary
voting power for the election of a majority of the directors (or the
equivalent) of such Person, other than shares, interests, participations or
other equivalents having such power only by reason of the occurrence of a
contingency.
ARTICLE II.
ISSUE, DESCRIPTION, TERMS, EXECUTION,
REGISTRATION AND EXCHANGE OF SECURITIES
SECTION 2.01. DESIGNATION AND TERMS OF SECURITIES.
(a) The aggregate principal amount of Debt Securities that may be
authenticated and delivered under this Indenture is unlimited. The Debt
Securities may be issued in one or more series up to the aggregate principal
amount of Debt Securities of that series from time to time authorized by or
pursuant to a Board Resolution of the Company or pursuant to one or more
indentures supplemental hereto. Prior to the initial issuance of Debt
Securities of any series, there shall be established in or pursuant to a
Board Resolution of the Company, and set forth in an Officers' Certificate of
the Company, or established in one or more indentures supplemental hereto:
(1) the title of the Debt Security of the series (which
shall distinguish the Debt Securities of the series from all other Debt
Securities);
(2) any limit upon the aggregate principal amount of the
Debt Securities of that series that may be authenticated and delivered
under this Indenture (except for Debt Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in
lieu of, other Debt Securities of that series);
(3) the date or dates on which the principal of the Debt
Securities of the series is payable;
(4) the rate or rates at which the Debt Securities of the
series shall bear interest or the manner of calculation of such rate or
rates, if any;
(5) the date or dates from which such interest shall accrue,
the Interest Payment Dates on which such interest will be payable or the
manner of determination of such Interest Payment Dates and the record
date for the deter-
8
mination of holders to whom interest is payable on any such Interest
Payment Dates;
(6) the right, if any, to extend the interest payment
periods and the duration of such extension;
(7) the period or periods within which, the price or prices
at which and the terms and conditions upon which, Debt Securities of the
series may be redeemed, in whole or in part, at the option of the
Company;
(8) the obligation, if any, of the Company to redeem or
purchase Debt Securities of the series pursuant to any sinking fund or
analogous provisions (including payments made in cash in participation
of future sinking fund obligations) or at the option of a holder thereof
and the period or periods within which, the price or prices at which,
and the terms and conditions upon which, Debt Securities of the series
shall be redeemed or purchased, in whole or in part, pursuant to such
obligation;
(9) the subordination terms of the Debt Securities of the series;
(10) the form of the Debt Securities of the series including
the form of the Certificate of Authentication for such series;
(11) if other than denominations of twenty-five U.S. dollars
($25) or any integral multiple thereof, the denominations in which the
Debt Securities of the series shall be issuable;
(12) any and all other terms with respect to such series
(which terms shall not be inconsistent with the terms of this Indenture)
including any terms which may be required by or advisable under United
States laws or regulations or advisable in connection with the marketing
of Debt Securities of that series; and
(13) whether the Debt Securities are issuable as a Global
Security and, in such case, the identity for the Depositary for such
series.
All Debt Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided
in or pursuant to any such Board Resolution or in any indentures supplemental
hereto.
9
If any of the terms of the series are established by action taken
pursuant to a Board Resolution of the Company, a copy of an appropriate
record of such action shall be certified by the Secretary or an Assistant
Secretary of the Company and delivered to the Trustee at or prior to the
delivery of the Officers' Certificate of the Company setting forth the terms
of the series.
(b) Prior to the issuance of any of the Guarantees, the exact form
and terms of such Guarantees, which shall comply with the terms of Section
2.12 hereof and contain such additional terms as are permitted by this
Indenture, shall be established by an Officers' Certificate of the Guarantor
or in an indenture supplemental hereto.
SECTION 2.02. FORM OF SECURITIES AND TRUSTEE'S CERTIFICATE.
The Securities of any series and the Trustee's certificate of
authentication to be borne by such Securities shall be substantially of the
tenor and purport as set forth in one or more indentures supplemental hereto
or as provided in a Board Resolution of the Company and as set forth in an
Officers' Certificate of the Company and the Guarantor, and may have such
letters, numbers or other marks of identification or designation and such
legends or endorsements printed, lithographed or engraved thereon as the
Company may deem appropriate and as are not inconsistent with the provisions
of this Indenture, or as may be required to comply with any law or with any
rule or regulation made pursuant thereto or with any rule or regulation of
any stock exchange on which Securities of that series may be listed, or to
conform to usage.
SECTION 2.03. DENOMINATIONS: PROVISIONS FOR PAYMENT.
The Securities shall be issuable as registered Securities and in the
denominations of twenty-five U.S. dollars ($25) or any integral multiple
thereof, subject to Section 2.01(10). The Securities of a particular series
shall bear interest payable on the dates and at the rate specified with
respect to that series. The principal of and the interest on the Securities
of any series, as well as any premium thereon in case of redemption thereof
prior to maturity, shall be payable in the coin or currency of the United
States of America that at the time is legal tender for public and private
debt, at the office or agency of the Company maintained for that purpose in
the Borough of Manhattan, the City and State of New York. Each Security
shall be dated the date of its authentication. Interest on the Securi-
10
ties shall be computed on the basis of a 360-day year composed of twelve
30-day months.
The interest installment on any Security that is payable, and is
punctually paid or duly provided for, on any Interest Payment Date for
Securities of that series shall be paid to the Person in whose name said
Security (or one or more Predecessor Securities) is registered at the close
of business on the regular record date for such interest installment. In the
event that any Security of a particular series or portion thereof is called
for redemption and the redemption date is subsequent to a regular record date
with respect to any Interest Payment Date and prior to such Interest Payment
Date, interest on such Security will be paid upon presentation and surrender
of such Security as provided in Section 3.03.
Any interest on any Security that is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date for Security of the
same series (herein called "Defaulted Interest") shall forthwith cease to be
payable to the registered holder on the relevant regular record date by
virtue of having been such holder; and such Defaulted Interest shall be paid
by the Company, at its election, as provided in clause (1) or clause (2)
below:
(1) The Company may make payment of any Defaulted Interest on
Securities to the Persons in whose names such Securities (or their
respective Predecessor Securities) are registered at the close of
business on a special record date for the payment of such Defaulted
Interest, which shall be fixed in the following manner: the Company
shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each such Security and the date of
the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Trustee for such deposit prior
to the date of the proposed payment, such money when deposited to be
held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this clause provided. Thereupon the
Trustee shall fix a special record date for the payment of such
Defaulted Interest which shall not be more than 15 nor less than 10
days prior to the date of the proposed payment and not less than 10
days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall
11
promptly notify the Company of such special record date and, in the
name and at the expense of the Company, shall cause notice of the
proposed payment of such Defaulted Interest and the special record
date therefor to be mailed, first class postage prepaid, to each
Securityholder at his or her address as it appears in the Security
Register (as hereinafter defined), not less than 10 days prior to
such special record date. Notice of the proposed payment of such
Defaulted Interest and the special record date therefor having been
mailed as aforesaid, such Defaulted Interest shall be paid to the
Persons in whose names such Securities (or their respective
Predecessor Securities) are registered on such special record date
and shall be no longer payable pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted Interest on
any Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Securities may
be listed, and upon such notice as may be required by such exchange,
if, after notice given by the Company to the Trustees of the
proposed payment pursuant to this clause, such manner of payment
shall be deemed practicable by the Trustee.
Unless otherwise set forth in a Board Resolution of the Company or
one or more indentures supplemental hereto establishing the terms of any
series of Securities pursuant to Section 2.01 hereof, the term "regular
record date" as used in this Section with respect to a series of Securities
with respect to any Interest Payment Date for such series shall mean either
the fifteenth day of the month immediately preceding the month in which an
Interest Payment Date established for such series pursuant to Section 2.01
hereof shall occur, if such Interest Payment Date is the first day of a
month, or the last day of the month immediately preceding the month in which
an Interest Payment Date established for such series pursuant to Section 2.01
hereof shall occur, if such Interest Payment Date is the fifteenth day of a
month, whether or not such date is a Business Day.
Subject to the foregoing provisions of this Section, each Security
of a series delivered under this Indenture upon transfer of or in exchange
for or in lieu of any other Security of such series shall carry the rights to
interest accrued and unpaid, and to accrue, that were carried by such other
Security.
12
SECTION 2.04. EXECUTION AND AUTHENTICATIONS.
The Debt Securities shall be signed on behalf of the Company by, and
the Guarantees endorsed thereon shall be signed on behalf of the Guarantor
by, its President, or one of its Vice Presidents, or its Treasurer, or one of
its Assistant Treasurers, or its Secretary, or one of its Assistant
Secretaries, under its corporate seal attested by its Secretary or one of its
Assistant Secretaries. Signatures may be in the form of a manual or
facsimile signature. The Company and the Guarantor may use the facsimile
signature of any Person who shall have been a President or Vice President
thereof, or of any Person who shall have been a Secretary or Assistant
Secretary thereof, notwithstanding the fact that at the time the Securities
shall be authenticated and delivered or disposed of such Person shall have
ceased to be the President or a Vice President, or the Secretary or an
Assistant Secretary, of the Company or the Guarantor, as the case may be.
The seal of the Company and the Guarantor may be in the form of a facsimile
of such seal and may be impressed, affixed, imprinted or otherwise reproduced
on the Securities. The Securities may contain such notations, legends or
endorsements required by law, stock exchange rule or usage. Each Security
shall be dated the date of its authentication by the Trustee.
A Security shall not be valid until authenticated manually by an
authorized signatory of the Trustee, or by an Authenticating Agent. Such
signature shall be conclusive evidence that the Security so authenticated has
been duly authenticated and delivered hereunder and that the holder is
entitled to the benefits of this Indenture.
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities of any series executed
by the Company and the Guarantor to the Trustee for authentication, together
with a written order of the Company for the authentication and delivery of
such Securities, signed by its President or any Vice President and its
Secretary or any Assistant Secretary, and the Trustee in accordance with such
written order shall authenticate and deliver such Securities.
In authenticating such Securities and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and (subject to Section 7.01) shall be
fully protected in relying upon, an Opinion of Counsel stating that the form
and terms thereof have been established in conformity with the provisions of
this Indenture.
13
The Trustee shall not be required to authenticate such Securities if
the issue of such Securities pursuant to this Indenture will affect the
Trustee's own rights, duties or immunities under the Securities and this
Indenture or otherwise in a manner that is not reasonably acceptable to the
Trustee.
SECTION 2.05. REGISTRATION OF TRANSFER AND EXCHANGE.
(a) Securities of any series may be exchanged upon presentation
thereof at the office or agency of the Company designated for such purpose in
the Borough of Manhattan, the City and State of New York, for other
Securities of such series of authorized denominations, and for a like
aggregate principal amount, upon payment of a sum sufficient to cover any tax
or other governmental charge in relation thereto, all as provided in this
Section. In respect of any Securities so surrendered for exchange, the
Company shall execute, the Trustee shall authenticate and such office or
agency shall deliver in exchange therefor the Security or Securities of the
same series that the Securityholder making the exchange shall be entitled to
receive, bearing numbers not contemporaneously outstanding.
(b) The Company shall keep, or cause to be kept, at its office or
agency designated for such purpose in the Borough of Manhattan, the City and
State of New York, or such other location designated by the Company a
register or registers (herein referred to as the "Security Register") in
which, subject to such reasonable regulations as it may prescribe, the
Company shall register the Securities and the transfers of Securities as in
this Article provided and which at all reasonable times shall be open for
inspection by the Trustee. The registrar for the purpose of registering
Securities and transfer of Securities as herein provided shall be appointed
as authorized by Board Resolution (the "Security Registrar").
Upon surrender for transfer of any Security at the office or agency
of the Company designated for such purpose, the Company shall execute, the
Trustee shall authenticate and such office or agency shall deliver in the
name of the transferee or transferees a new Security or Securities of the
same series as the Security presented for a like aggregate principal amount.
All Securities presented or surrendered for exchange or registration
of transfer, as provided in this Section, shall be accompanied (if so
required by the Company or the Security Registrar) by a written instrument or
instruments of transfer, in form satisfactory to the Company or the Security
Registrar, duly
14
executed by the registered holder or by such holder's duly authorized
attorney in writing.
(c) No service charge shall be made for any exchange or
registration of transfer of Securities, or issue of new Securities in case of
partial redemption of any series, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge in relation
thereto, other than exchanges pursuant to Section 2.06, the second paragraph
of Section 3.03 and Section 9.04 not involving any transfer.
(d) The Company shall not be required (i) to issue, exchange or
register the transfer of any Securities during a period beginning at the
opening of business 15 days before the day of the mailing of a notice of
redemption of less than all the Outstanding Securities of the same series and
ending at the close of business on the day of such mailing, nor (ii) to
register the transfer of or exchange any Securities of any series or portions
thereof called for redemption. The provisions of this Section 2.05 are, with
respect to any Global Security, subject to Section 2.11 hereof.
SECTION 2.06. TEMPORARY SECURITIES.
Pending the preparation of definitive Securities of any series, the
Company and the Guarantor may execute, and the Trustee shall authenticate and
deliver, temporary Securities (printed, lithographed or typewritten) of any
authorized denomination. Such temporary Securities shall be substantially in
the form of the definitive Securities in lieu of which they are issued, but
with such omissions, insertions and variations as may be appropriate for
temporary Securities, all as may be determined by the Company. Every
temporary Security of any series shall be executed by the Company and the
Guarantor and be authenticated by the Trustee upon the same conditions and in
substantially the same manner, and with like effect, as the definitive
Securities of such series. Without unnecessary delay the Company and the
Guarantor will execute and will furnish definitive Securities of such series
and thereupon any or all temporary Securities of such series may be
surrendered in exchange therefor (without charge to the holders), at the
office or agency of the Company designated for the purpose in the Borough of
Manhattan, the City and State of New York, and the Trustee shall authenticate
and such office or agency shall deliver in exchange for such temporary
Securities an equal aggregate principal amount of definitive Securities of
such series, unless the Company advises the Trustee to the effect that
definitive Securities need not be executed and furnished until
15
further notice from the Company. Until so exchanged, the temporary
Securities of such series shall be entitled to the same benefits under this
Indenture as definitive Securities of such series authenticated and delivered
hereunder.
SECTION 2.07. MUTILATED, DESTROYED, LOST OR STOLEN SECURITIES.
In case any temporary or definitive Security shall become mutilated
or be destroyed, lost or stolen, the Company and the Guarantor (subject to
the next succeeding sentence) shall execute, and upon the Company's request
the Trustee (subject as aforesaid) shall authenticate and deliver, a new
Security of the same series, bearing a number not contemporaneously
outstanding, in exchange and substitution for the mutilated Security, or in
lieu of and in substitution for the Security so destroyed, lost or stolen.
In every case the applicant for a substituted Security shall furnish to the
Company, the Guarantor and the Trustee such security or indemnity as may be
required by them to save each of them harmless, and, in every case of
destruction, loss or theft, the applicant shall also furnish to the Company,
the Guarantor and the Trustee evidence to their satisfaction of the
destruction, loss or theft of the applicant's Security and of the ownership
thereof. The Trustee may authenticate any such substituted Security and
deliver the same upon the written request or authorization of any officer of
the Company. Upon the issuance of any substituted Security, the Company may
require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected
therewith. In case any Security that has matured or is about to mature shall
become mutilated or be destroyed, lost or stolen, the Company may, instead of
issuing a substitute Security, pay or authorize the payment of the same
(without surrender thereof except in the case of a mutilated Security) if the
applicant for such payment shall furnish to the Company, the Guarantor and
the Trustee such security or indemnity as they may require to save them
harmless, and, in case of destruction, loss or theft, evidence to the
satisfaction of the Company, the Guarantor and the Trustee of the
destruction, loss or theft of such Security and of the ownership thereof.
Every replacement Security issued pursuant to the provisions of this
Section shall constitute an additional contractual obligation of the Company
or the Guarantor, as the case may be, whether or not the mutilated,
destroyed, lost or stolen Security shall be found at any time, or be
enforceable by anyone, and shall be entitled to all the benefits of this
16
Indenture equally and proportionately with any and all other Securities of
the same series duly issued hereunder. All Securities shall be held and
owned upon the express condition that the foregoing provisions are exclusive
with respect to the replacement or payment of mutilated, destroyed, lost or
stolen Securities, and shall preclude (to the extent lawful) any and all
other rights or remedies, notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment
of negotiable instruments or other securities without their surrender.
SECTION 2.08. CANCELLATION.
All Securities surrendered for the purpose of payment, redemption,
exchange or registration of transfer shall, if surrendered to the Company,
the Guarantor or any paying agent, be delivered to the Trustee for
cancellation, or, if surrendered to the Trustee, shall be cancelled by it,
and no Securities shall be issued in lieu thereof except as expressly
required or permitted by any of the provisions of this Indenture. On request
of the Company at the time of such surrender, the Trustee shall deliver to
the Company canceled Securities held by the Trustee. In the absence of such
request the Trustee may dispose of canceled Securities in accordance with its
standard procedures and deliver a certificate of disposition to the Company.
If the Company or the Guarantor shall otherwise acquire any of the
Securities, however, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Securities unless and
until the same are delivered to the Trustee for cancellation.
SECTION 2.09. BENEFITS OF INDENTURE.
Nothing in this Indenture or in the Securities, express or implied,
shall give or be construed to give to any Person, other than the parties
hereto and the holders of the Securities (and, with respect to the provisions
of Article Fourteen, the holders of Senior Indebtedness) any legal or
equitable right, remedy or claim under or in respect of this Indenture, or
under any covenant, condition or provision herein contained; all such
covenants, conditions and provisions being for the sole benefit of the
parties hereto and of the holders of the Securities (and, with respect to the
provisions of Article Fourteen, the holders of Senior Indebtedness).
17
SECTION 2.10. AUTHENTICATING AGENT.
So long as any of the Securities of any series remain Outstanding
there may be an Authenticating Agent for any or all such series of Securities
which the Trustee shall have the right to appoint. Said Authenticating Agent
shall be authorized to act on behalf of the Trustee to authenticate
Securities of such series issued upon exchange, transfer or partial
redemption thereof, and Securities so authenticated shall be entitled to the
benefits of this Indenture and shall be valid and obligatory for all purposes
as if authenticated by the Trustee hereunder. All references in this
Indenture to the authentication of Securities by the Trustee shall be deemed
to include authentication by an Authenticating Agent for such series. Each
Authenticating Agent shall be acceptable to the Company and shall be a
corporation that has a combined capital and surplus, as most recently
reported or determined by it, sufficient under the laws of any jurisdiction
under which it is organized or in which it is doing business to conduct a
trust business, and that is otherwise authorized under such laws to conduct
such business and is subject to supervision or examination by Federal or
State authorities. If at any time any Authenticating Agent shall cease to be
eligible in accordance with these provisions, it shall resign immediately.
Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at
any time (and upon request by the Company shall) terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and to the Company. Upon resignation, termination or
cessation of eligibility of any Authenticating Agent, the Trustee may appoint
an eligible successor Authenticating Agent acceptable to the Company. Any
successor Authenticating Agent, upon acceptance of its appointment hereunder,
shall become vested with all the rights, powers and duties of its predecessor
hereunder as if originally named as an Authenticating Agent pursuant hereto.
SECTION 2.11. GLOBAL SECURITIES.
(a) If the Company shall establish pursuant to Section 2.01 that
the Securities of a particular series are to be issued as a Global Security,
then the Company shall execute and the Trustee shall, in accordance with
Section 2.04, authenticate and deliver, a Global Security that (i) shall
represent, and shall be denominated in an amount equal to the aggregate
principal amount of, all of the Outstanding Securities of such series, (ii)
shall be registered in the name of the Depositary or its nominee, (iii)
18
shall be delivered by the Trustee to the Depositary or pursuant to the
Depositary's instruction and (iv) shall bear a legend substantially to the
following effect: "Except as otherwise provided in Section 2.11 of the
Indenture, this Security may be transferred, in whole but not in part, only
to another nominee of the Depositary or to a successor Depositary or to a
nominee of such successor Depositary."
(b) Notwithstanding the provisions of Section 2.05, the Global
Security of a series may be transferred, in whole but not in part and in the
manner provided in Section 2.05, only to another nominee of the Depositary
for such series, or to a successor Depositary for such series selected or
approved by the Company or to a nominee of such successor Depositary.
(c) If at any time the Depositary for a series of the Securities
notifies the Company that it is unwilling or unable to continue as Depositary
for such series or if at any time the Depositary for such series shall no
longer be registered or in good standing under the Exchange Act, or other
applicable statute or regulation, and a successor Depositary for such series
is not appointed by the Company within 90 days after the Company receives
such notice or becomes aware of such condition, as the case may be, this
Section 2.11 shall no longer be applicable to the Securities of such series
and the Company will execute, and subject to Section 2.05, the Trustee will
authenticate and deliver the Securities of such series in definitive
registered form without coupons, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the Global
Security of such series in exchange for such Global Security. In addition,
the Company may at any time determine that the Securities of any series shall
no longer be represented by a Global Security and that the provisions of this
Section 2.11 shall no longer apply to the Securities of such series. In such
event the Company and the Guarantor will execute and subject to Section 2.05,
the Trustee, upon receipt of an Officers' Certificate evidencing such
determination by the Company, will authenticate and deliver the Securities of
such series in definitive registered form without coupons, in authorized
denominations, and in an aggregate principal amount equal to the principal
amount of the Global Security of such series in exchange for such Global
Security. Upon the exchange of the Global Security for such Securities in
definitive registered form without coupons, in authorized denominations, the
Global Security shall be canceled by the Trustee. Such Securities in
definitive registered form issued in exchange for the Global Security
pursuant to this Section 2.11(c) shall be registered in such names and in
such authorized denominations as the Depositary,
19
pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Trustee. The Trustee shall deliver such
Securities to the Depositary for delivery to the Persons in whose names such
Securities are so registered.
SECTION 2.12. UNCONDITIONAL GUARANTEES.
(FORM OF GUARANTEE)
FOR VALUE RECEIVED, the Guarantor, hereby unconditionally guarantees
to the holder of the Security upon which this Guarantee is endorsed the due
and punctual payment of the principal of, sinking fund payment, if any,
premium, if any, or interest on said Security, when and as the same shall
become due and payable, whether at maturity, upon redemption or otherwise,
according to the terms thereof and of the Indenture referred to therein.
The Guarantor agrees to determine, at least one business day prior
to the date upon which a payment of principal of, sinking fund payment, if
any, premium, if any, or interest on said Security is due and payable,
whether the Company has available the funds to make such payment as the same
shall become due and payable. In case of the failure of the Company
punctually to pay any such principal, sinking fund payment, if any, premium,
if any, or interest, the Guarantor hereby agrees to cause any such payment to
be made punctually when and as the same shall become due and payable, whether
at maturity, upon redemption, or otherwise, and as if such payment were made
by the Company.
The Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrevocable, and absolute, irrespective of the validity,
regularity, or enforceability of said Security or said Indenture, the absence
of any action to enforce the same, any waiver or consent by the Holder of
said Security with respect to any provisions thereof, the recovery of any
judgment against the Company or any action to enforce the same, or any other
circumstance which might otherwise constitute a legal or equitable discharge
or defense of a guarantor. The Guarantor hereby waives diligence,
presentment, demand of payment, filing of claims with a court in the event of
merger or bankruptcy of the Company, any right to require a proceeding first
against the Company, protest or notice with respect to said Security or
indebtedness evidenced thereby, and all demands whatsoever and covenants that
this Guarantee will not be
20
discharged except by complete performance of the obligations contained in
said Security and in this Guarantee.
The Guarantor shall be subrogated to all rights of the holder of
said Security against the Company in respect of any amounts paid by the
Guarantor pursuant to the provisions of this Guarantee; provided, however,
that the Guarantor shall not, without the consent of the holders of all of
the Securities then outstanding, be entitled to enforce or to receive any
payments arising out of or based upon such right of subrogation until the
principal of and premium, if any, and interest on all Securities shall have
been paid in full or payment thereof shall have been provided for in
accordance with said Indenture.
Notwithstanding anything to the contrary contained herein, if
following any payment of principal or interest by the Company on the
Securities to the holders of the Securities it is determined by a final
decision of a court of competent jurisdiction that such payment shall be
avoided by a trustee in bankruptcy (including any debtor-in-possession) as a
preference under 11 U.S.C. Section 547 and such payment is paid by such
holder to such trustee in bankruptcy, then and to the extent of such
repayment, the obligations of the Guarantor hereunder shall remain in full
force and effect.
This Guarantee shall not be valid or become obligatory for any
purpose with respect to a Security until the certificate of authentication on
such Security shall have been signed by the Trustee (or the Authentication
Agent).
This Guarantee shall be governed by the laws of the State of New York.
IN WITNESS WHEREOF, U S WEST, Inc. (to be renamed "MediaOne Group,
Inc.") has caused this Guarantee to be signed in its corporate name by the
facsimile signature of two of its officers thereunto duly authorized and has
caused a facsimile of its corporate seal to be affixed hereunto or imprinted
or otherwise reproduced hereon.
SECTION 2.13. EXECUTION OF GUARANTEE.
To evidence the Guarantee to the Securityholders specified in
Section 2.12, the Guarantor hereby agrees to execute the Guarantees, in
substantially the form above recited, to be endorsed on each Security
authenticated and delivered by the Trustee (or the Authenticating Agent).
Each such Guarantee shall be signed on behalf of the Guarantor as set forth
in Section 2.04
21
prior to the authentication of the Security on which it is endorsed, and the
delivery of such Security by the Trustee (or the Authenticating Agent), after
the authentication thereof hereunder, shall constitute due delivery of such
Guarantee on behalf of the Guarantor.
SECTION 2.14. ASSUMPTION BY GUARANTOR.
(a) The Guarantor may, without the consent of the Securityholders,
assume all of the rights and obligations of the Company hereunder with
respect to a series of Securities and under the Securities of such series if,
after giving effect to such assumption, no Default or Event of Default shall
have occurred and be continuing. Upon such an assumption, the Guarantor
shall execute a supplemental indenture evidencing its assumption of all such
rights and obligations of the Company and the Company shall be released from
its liabilities hereunder and under such Securities as obligor on the
Securities of such series.
(b) The Guarantor shall assume all of the rights and obligations of
the Company hereunder with respect to a series of Securities and under the
Securities of such series if, upon a default by the Company in the due and
punctual payment of the principal, sinking fund payment, if any, premium, if
any, or interest on such Securities, the Guarantor is prevented by any court
order or judicial proceeding from fulfilling its obligations under Section
2.12 with respect to such series of Securities. Such assumption shall result
in the Securities of such series becoming the direct obligations of the
Guarantor and shall be effected without the consent of the holders of the
Securities of any series. Upon such an assumption, the Guarantor shall
execute a supplemental indenture evidencing its assumption of all such rights
and obligations of the Company, and the Company shall be released from its
liabilities hereunder and under such Securities as obligor on the Securities
of such series.
ARTICLE III.
REDEMPTION OF DEBT SECURITIES AND SINKING FUND PROVISIONS
SECTION 3.01. REDEMPTION.
The Company may redeem the Debt Securities of any series issued
hereunder on and after the dates and in accordance
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with the terms established for such series pursuant to Section 2.01 hereof.
SECTION 3.02. NOTICE OF REDEMPTION.
(a) In case the Company shall desire to exercise such right to
redeem all or, as the case may be, a portion of the Debt Securities of any
series in accordance with the right reserved so to do, the Company shall, or
shall cause the Trustee to, give notice of such redemption to holders of the
Debt Securities of such series to be redeemed by mailing, first class postage
prepaid, a notice of such redemption not less than 30 days and not more than
90 days before the date fixed for redemption of that series to such holders
at their last addresses as they shall appear upon the Security Register
unless a shorter period is specified in the Debt Securities to be redeemed.
Any notice that is mailed in the manner herein provided shall be conclusively
presumed to have been duly given, whether or not the registered holder
receives the notice. In any case, failure duly to give such notice to the
holder of any Security of any series designated for redemption in whole or in
part, or any defect in the notice, shall not affect the validity of the
proceedings for the redemption of any other Debt Securities of such series or
any other series. In the case of any redemption of Debt Securities prior to
the expiration of any restriction on such redemption provided in the terms of
such Debt Securities or elsewhere in this Indenture, the Company shall
furnish the Trustee with an Officers' Certificate evidencing compliance with
any such restriction.
Each such notice of redemption shall specify the date fixed for
redemption and the redemption price at which Debt Securities of that series
are to be redeemed, and shall state that payment of the redemption price of
such Debt Securities to be redeemed will be made at the office or agency of
the Company in the Borough of Manhattan, the City and State of New York, upon
presentation and surrender of such Debt Securities, that interest accrued to
the date fixed for redemption will be paid as specified in said notice, that
from and after said date interest will cease to accrue and that the
redemption is for a sinking fund, if such is the case. If less than all the
Debt Securities of a series are to be redeemed, the notice to the holders of
Debt Securities of that series to be redeemed in whole or in part shall
specify the particular Debt Securities to be so redeemed. In case any
Security is to be redeemed in part only, the notice that relates to such
Security shall state the portion of the principal amount thereof to be
redeemed, and shall state that on and after the redemption date, upon
surrender of such Security, a
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new Security or Debt Securities of such series in principal amount equal to
the unredeemed portion thereof and having endorsed thereon a duly executed
Guarantee will be issued.
(b) If less than all the Debt Securities of a series are to be
redeemed, the Company shall give the Trustee at least 45 days' notice in
advance of the date fixed for redemption as to the aggregate principal amount
of Debt Securities of the series to be redeemed, and thereupon the Trustee
shall select, by lot or in such other manner as it shall deem appropriate and
fair in its discretion and that may provide for the selection of a portion or
portions (equal to twenty-five U.S. dollars ($25) or any integral multiple
thereof) of the principal amount of such Debt Securities of a denomination
larger than $25, the Debt Securities to be redeemed and shall thereafter
promptly notify the Company in writing of the numbers of the Debt Securities
to be redeemed, in whole or in part.
The Company may, if and whenever it shall so elect, by delivery of
instructions signed on its behalf by its President or any Vice President,
instruct the Trustee or any paying agent to call all or any part of the Debt
Securities of a particular series for redemption and to give notice of
redemption in the manner set forth in this Section, such notice to be in the
name of the Company or its own name as the Trustee or such paying agent may
deem advisable. In any case in which notice of redemption is to be given by
the Trustee or any such paying agent, the Company shall deliver or cause to
be delivered to, or permit to remain with, the Trustee or such paying agent,
as the case may be, such Security Register, transfer books or other records,
or suitable copies or extracts therefrom, sufficient to enable the Trustee or
such paying agent to give any notice by mail that may be required under the
provisions of this Section.
SECTION 3.03. PAYMENT UPON REDEMPTION.
(a) If the giving of notice of redemption shall have been completed
as above provided, the Debt Securities or portions of Debt Securities of the
series to be redeemed specified in such notice shall become due and payable
on the date and at the place stated in such notice at the applicable
redemption price, together with interest accrued to the date fixed for
redemption and interest on such Debt Securities or portions of Debt
Securities shall cease to accrue on and after the date fixed for redemption,
unless the Company shall default in the payment of such redemption price and
accrued interest with respect to any such Security or portion thereof. On
presentation and surrender of such Debt Securities on or after the date fixed
for redemption
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at the place of payment specified in the notice, said Debt Securities shall
be paid and redeemed at the applicable redemption price for such series,
together with interest accrued thereon to the date fixed for redemption (but
if the date fixed for redemption is an interest payment date, the interest
installment payable on such date shall be payable to the registered holder at
the close of business on the applicable record date pursuant to Section 2.03).
(b) Upon presentation of any Security of such series that is to be
redeemed in part only, the Company shall execute and the Trustee shall
authenticate and the office or agency where the Security is presented shall
deliver to the holder thereof, at the expense of the Company, a new Security
or Debt Securities of the same series, having endorsed thereon a duly
executed Guarantee, of authorized denominations in principal amount equal to
the unredeemed portion of the Security so presented.
SECTION 3.04. SINKING FUND.
The provisions of Sections 3.04, 3.05 and 3.06 shall be applicable
to any sinking fund for the retirement of Debt Securities of a series, except
as otherwise specified as contemplated by Section 2.01 for Debt Securities of
such series.
The minimum amount of any sinking fund payment provided for by the
terms of Debt Securities of any series is herein referred to as a "mandatory
sinking fund payment," and any payment in excess of such minimum amount
provided for by the terms of Debt Securities of any series is herein referred
to as an "optional sinking fund payment". If provided for by the terms of
Debt Securities of any series, the cash amount of any sinking fund payment
may be subject to reduction as provided in Section 3.05. Each sinking fund
payment shall be applied to the redemption of Debt Securities of any series
as provided for by the terms of Debt Securities of such series.
SECTION 3.05. SATISFACTION OF SINKING FUND PAYMENTS WITH DEBT
SECURITIES.
The Company (i) may deliver Outstanding Debt Securities of a series
(other than any Debt Securities previously called for redemption) and (ii)
may apply as a credit Debt Securities of a series that have been redeemed
either at the election of the Company pursuant to the terms of such Debt
Securities or through the application of permitted optional sinking fund
payments pursuant to the terms of such Debt Securities, in each case in
satisfaction of all or any part of any sinking fund payment with
25
respect to the Debt Securities of such series required to be made pursuant to
the terms of such Debt Securities as provided for by the terms of such
series, PROVIDED that such Debt Securities have not been previously so
credited. Such Debt Securities shall be received and credited for such
purpose by the Trustee at the redemption price specified in such Debt
Securities for redemption through operation of the sinking fund and the
amount of such sinking fund payment shall be reduced accordingly.
SECTION 3.06. REDEMPTION OF DEBT SECURITIES FOR SINKING FUND.
Not less than 45 days prior to each sinking fund payment date for
any series of Debt Securities, the Company will deliver to the Trustee an
Officers' Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of the series, the portion
thereof, if any, that is to be satisfied by delivering and crediting Debt
Securities of that series pursuant to Section 3.05 and the basis for such
credit and will, together with such Officers' Certificate, deliver to the
Trustee any Debt Securities to be so delivered. Not less than 30 days before
each such sinking fund payment date the Trustee shall select the Debt
Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 3.02 and cause notice of the redemption thereof to be
given in the name of and at the expense of the Company in the manner provided
in Section 3.02. Such notice having been duly given, the redemption of such
Debt Securities shall be made upon the terms and in the manner stated in
Section 3.03.
ARTICLE IV.
SECTION 4.01. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company will duly and punctually pay or cause to be paid the
principal of (and premium, if any) and interest on the Debt Securities of
that series at the time and place and in the manner provided herein and
established with respect to such Debt Securities.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
So long as any series of the Securities remain Outstanding, the
Company agrees to maintain an office or agency in the Borough of Manhattan,
the City and State of New York, with
26
respect to each such series and at such other location or locations as may be
designated as provided in this Section 4.02, where (i) Securities of that
series may be presented for payment, (ii) Securities of that series may be
presented as hereinabove authorized for registration of transfer and
exchange, and (iii) notices and demands to or upon the Company in respect of
the Securities of that series and this Indenture may be given or served, such
designation to continue with respect to such office or agency until the
Company shall, by written notice signed by its President or a Vice President
and delivered to the trustee, designate some other office or agency for such
purposes or any of them. If at any time the Company shall fail to maintain
any such required office or agency or shall fail to furnish the Trustee with
the address thereof, such presentations, notices and demands may be made or
served at the Corporate Trust Office of the Trustee, and the Company hereby
appoints the Trustee as its agent to receive all such presentations, notices
and demands.
SECTION 4.03. PAYING AGENTS.
(a) If the Company shall appoint one or more paying agents for all
or any series of the Securities, other than the Trustee, the Company will
cause each such paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee, subject to the
provisions of this Section:
(1) that it will hold all sums held by it as such agent for
the payment of the principal of (and premium, if any) or interest on
the Securities of that series (whether such sums have been paid to
it by the Company or by any other obligor of such Securities) in
trust for the benefit of the Persons entitled thereto;
(2) that it will give the Trustee notice of any failure by the
Company (or by any other obligor of such Securities) to make any
payment of the principal of (and premium, if any) or interest on the
Securities of that series when the same shall be due and payable;
(3) that it will, at any time during the continuance of any
failure referred to in the preceding paragraph (a)(2) above, upon
the written request of the Trustee, forthwith pay to the Trustee all
sums so held in trust by such paying agent; and
(4) that it will perform all other duties of paying agent as
set forth in this Indenture.
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(b) If the Company shall act as its own paying agent with respect
to any series of the Securities, it will on or before each due date of the
principal of (and premium, if any) or interest on Securities of that series,
set aside, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay such principal (and premium, if any)
or interest so becoming due on Securities of that series until such sums
shall be paid to such Persons or otherwise disposed of as herein provided and
will promptly notify the Trustee of such action, or any failure (by it or any
other obligor on such Securities) to take such action. Whenever the Company
shall have one or more paying agents for any series of Securities, it will,
prior to each due date of the principal of (and premium, if any) or interest
on any Securities of that series, deposit with the paying agent a sum
sufficient to pay the principal (an premium, if any) or interest so becoming
due, such sum to be held in trust for the benefit of the Persons entitled to
such principal, premium or interest, and (unless such paying agent is the
Trustee) the Company will promptly notify the Trustee of this action or
failure so to act.
(c) Notwithstanding anything in this Section to the contrary, (i)
the agreement to hold sums in trust as provided in this Section is subject to
the provisions of Section 11.05, and (ii) the Company may at any time, for
the purpose of obtaining the satisfaction and discharge of this Indenture or
for any other purpose, pay, or direct any paying agent to pay, to the Trustee
all sums held in trust by the Company or such paying agent, such sums to be
held by the Trustee upon the same terms and conditions as those upon which
such sums were held by the Company or such paying agent; and, upon such
payment by any paying agent to the Trustee, such paying agent shall be
released from all further liability with respect to such money.
SECTION 4.04. APPOINTMENT TO FILL VACANCY IN OFFICE OF TRUSTEE.
The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 7.10, a
Trustee, so that there shall at all times be a Trustee hereunder.
SECTION 4.05. COMPLIANCE WITH CONSOLIDATION PROVISIONS.
Neither the Company nor the Guarantor will, while any of the
Securities remain Outstanding, consolidate with, or merge into, or merge into
itself, or sell or convey all or
28
substantially all of its property to any other company unless the provisions
of Article Ten hereof are complied with.
SECTION 4.06. LIMITATION ON DIVIDENDS; TRANSACTIONS WITH AFFILIATES.
(a) If Securities are issued to a MediaOne Trust or a trustee of
such trust in connection with the issuance of Trust Securities by such
MediaOne Trust and (i) there shall have occurred any event that would
constitute an Event of Default or (ii) U S WEST shall be in default with
respect to its payment or any obligations under the Preferred Securities
Guarantee or Common Securities Guarantee relating to such MediaOne Trust,
then (x) the Guarantor and the Company shall not declare or pay any dividend
on, make any distributions with respect to, or redeem, purchase or make a
liquidation payment with respect to, any of its capital stock, and (y) the
Guarantor and the Company shall not make any payment of interest, principal
or premium, if any, on or repay, repurchase or redeem any debt securities
(including guarantees) issued by the Guarantor or the Company which rank pari
passu with or junior to such Securities; PROVIDED, HOWEVER, that restriction
(y) above does not apply to any stock dividends paid by the Guarantor where
the dividend stock is the same stock as that on which the dividend is being
paid.
(b) If Securities are issued to a MediaOne Trust or a trustee of
such trust in connection with the issuance of Trust Securities by such
MediaOne Trust and the Company shall have given notice of its election to
defer payments of interest on such Securities by extending the interest
payment period as provided in any Board Resolution or indenture supplemental
hereto and such period, or any extension thereof, shall be continuing, then
(i) the Guarantor and the Company shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase or make a
liquidation payment with respect to, any of its capital stock, and (ii) the
Guarantor and the Company shall not make any payment of interest, principal
or premium, if any, on or repay, repurchase or redeem any debt securities
(including guarantees) issued by the Guarantor or the Company which rank pari
passu with or junior to such Securities; PROVIDED, HOWEVER, that restriction
(i) above does not apply to any stock dividends paid by the Guarantor where
the dividend stock is the same stock as that on which the dividend is being
paid..
29
SECTION 4.07. COVENANTS AS TO MEDIAONE TRUSTS.
In the event Securities are issued to a MediaOne Trust or a trustee
of such trust in connection with the issuance of Trust Securities by such
MediaOne Trust, for so long as such Trust Securities remain outstanding, the
Guarantor will (i) maintain 100% direct or indirect ownership of the Common
Securities of such MediaOne Trust; PROVIDED, HOWEVER, that any permitted
successor of the Guarantor under the Indenture may succeed to the Guarantor's
ownership of the Common Securities and (ii) use its reasonable efforts to
cause such MediaOne Trust (a) to remain a statutory business trust, except in
connection with a distribution of Securities, the redemption of all of the
Trust Securities of such MediaOne Trust or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of such MediaOne Trust,
and (b) to otherwise continue not to be treated as a grantor trust for United
States federal income tax purposes.
ARTICLE V.
SECURITYHOLDERS' LISTS AND REPORTS
BY THE COMPANY AND THE TRUSTEE
SECTION 5.01. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
SECURITYHOLDERS.
The Company will furnish or cause to be furnished to the Trustee (a)
on a monthly basis on each regular record date (as defined in Section 2.03) a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the holders of each series of Securities as of such regular
record date, PROVIDED that the Company shall not be obligated to furnish or
cause to furnish such list at any time that the list shall not differ in any
respect from the most recent list furnished to the Trustee by the Company and
(b) at such other times as the Trustee may request in writing within 30 days
after the receipt by the Company of any such request, a list of similar form
and content as of a date not more than 15 days prior to the time such list is
furnished; PROVIDED, HOWEVER, that, in either case, no such list need be
furnished for any series for which the Trustee shall be the Security
Registrar.
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SECTION 5.02. PRESERVATION OF INFORMATION; COMMUNICATIONS WITH
SECURITYHOLDERS.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of the
holders of Securities contained in the most recent list furnished to it as
provided in Section 5.01 and as to the names and addresses of holders of
Securities received by the Trustee in its capacity as Security Registrar (if
acting in such capacity).
(b) The Trustee may destroy any list furnished to it as provided in
Section 5.01 upon receipt of a new list so furnished.
(c) Securityholders may communicate as provided in Section 312(b)
of the Trust Indenture Act with other Securityholders with respect to their
rights under this Indenture or under the Securities.
SECTION 5.03. REPORTS BY THE GUARANTOR.
(a) The Guarantor covenants and agrees to file with the Trustee,
within 15 days after the Guarantor is required to file the same with the
Commission, copies of the annual reports and of the information, documents
and other reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe) that the
Guarantor may be required to file with the Commission pursuant to Section 13
or Section 15(d) of the Exchange Act; or, if the Guarantor is not required to
file information, documents or reports pursuant to either of such sections,
then to file with the Trustee and the Commission, in accordance with the
rules and regulations prescribed from time to time by the Commission, such of
the supplementary and periodic information, documents and reports that may be
required pursuant to Section 13 of the Exchange Act, in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations.
(b) The Guarantor covenants and agrees to file with the Trustee and
the Commission, in accordance with the rules and regulations prescribed from
to time by the Commission, such additional information, documents and reports
with respect to compliance by the Guarantor and the Company with the
conditions and covenants provided for in this Indenture as may be required
from time to time by such rules and regulations.
31
(c) The Guarantor covenants and agrees to transmit by mail, first
class postage prepaid, or reputable over-night delivery service that provides
for evidence of receipt, to the Securityholders, as their names and addresses
appear upon the Security Register, within 30 days after the filing thereof
with the Trustee, such summaries of any information, documents and reports
required to be filed by the Guarantor pursuant to subsections (a) and (b) of
this Section as may be required by rules and regulations prescribed from time
to time by the Commission.
SECTION 5.04. REPORTS BY THE TRUSTEE.
(a) On or before July 15 in each year in which any of the
Securities are Outstanding, the Trustee shall transmit by mail, first class
postage prepaid, to the Securityholders, as their names and addresses appear
upon the Security Register, a brief report dated as of the preceding May 15,
if and to the extent required under Section 313(a) of the Trust Indenture Act.
(b) The Trustee shall comply with Section 313(b) and 313(c) of the
Trust Indenture Act.
(c) A copy of each such report shall, at the time of such
transmission to Securityholders, be filed by the Trustee with the Company,
with each stock exchange upon which any Securities are listed (if so listed)
and also with the Commission. The Company agrees to notify the Trustee when
any Securities become listed on any stock exchange.
ARTICLE VI.
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT.
(a) Whenever used herein with respect to Securities of a particular
series, "Event of Default" means any one or more of the following events that
has occurred and is continuing:
(1) the Company or the Guarantor defaults in the payment of any
installment of interest upon any of the Securities of that series, as
and when the same shall become due and payable, and continuance of such
default for a period of 90 days; PROVIDED, HOWEVER, that a valid
extension of an interest payment period by the Company in accordance
32
with the terms of any indenture supplemental hereto, shall not
constitute a default in the payment of interest for this purpose;
(2) the Company or the Guarantor defaults in the payment of
the principal of (or premium, if any, on) any of the Securities of
that series as and when the same shall become due and payable
whether at maturity, upon redemption, by declaration or otherwise,
or in any payment required by any sinking or analogous fund
established with respect to that series; PROVIDED, HOWEVER, that a
valid extension of the maturity of such Securities in accordance
with the terms of any indenture supplemental hereto shall not
constitute a default in the payment of principal or premium, if any;
(3) the Company or the Guarantor fails to observe or perform
any other of its covenants or agreements with respect to that series
contained in this Indenture or otherwise established with respect to
that series of Securities pursuant to Section 2.01 hereof (other
than a covenant or agreement that has been expressly included in
this Indenture solely for the benefit of one or more series of
Securities other than such series) for a period of 90 days after the
date on which written notice of such failure, requiring the same to
be remedied and stating that such notice is a "Notice of Default"
hereunder, shall have been given to the Company by the Trustee, by
registered or certified mail, or to the Company and the Trustee by
the holders of at least 25% in principal amount of the Securities of
that series at the time Outstanding;
(4) the Company or the Guarantor pursuant to or within the
meaning of any Bankruptcy Law (i) commences a voluntary case, (ii)
consents to the entry of an order for relief against it in an
involuntary case, (iii) consents to the appointment of a Custodian
of it or for all or substantially all of its property or (iv) makes
a general assignment for the benefit of its creditors;
(5) a court of competent jurisdiction enters an order under
any Bankruptcy Law that (i) is for relief against the Company or the
Guarantor in an involuntary case, (ii) appoints a Custodian of the
Company or the Guarantor for all or substantially all of their
respective property, or (iii) orders the liquidation of the Company
or the Guarantor, and the order or decree remains unstayed and in
effect for 90 days; or
33
(6) in the event Securities are issued to a MediaOne Trust or
a trustee of such trust in connection with the issuance of Trust
Securities by such MediaOne Trust, such MediaOne Trust shall have
voluntarily or involuntarily dissolved, wound-up its business or
otherwise terminated its existence except in connection with (i) the
distribution of Securities to holders of Trust Securities in
liquidation of their interests in such MediaOne Trust, (ii) the
redemption of all of the outstanding Trust Securities of such
MediaOne Trust or (iii) certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of such MediaOne
Trust.
(b) In each and every such case, unless the principal of all the
Securities of that series shall have already become due and payable, either
the Trustee or the holders of not less than 25% in aggregate principal amount
of the Securities of that series then Outstanding hereunder, by notice in
writing to the Company and the Guarantor (and to the Trustee if given by such
Securityholders), may declare the principal of all the Securities of that
series to be due and payable immediately, and upon any such declaration the
same shall become and shall be immediately due and payable, notwithstanding
anything contained in this Indenture or in the Securities of that series or
established with respect to that series pursuant to Section 2.01 to the
contrary.
(c) At any time after the principal of the Securities of that
series shall have been so declared due and payable, and before any judgment
or decree for the payment of the moneys due shall have been obtained or
entered as hereinafter provided, the holders of a majority in aggregate
principal amount of the Securities of that series then Outstanding hereunder,
by written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if: (i) the Company or the Guarantor has
paid or deposited with the Trustee a sum sufficient to pay all matured
installments of interest upon all the Securities of that series and the
principal of (and premium, if any, on) any and all Securities of that series
that shall have become due otherwise than by acceleration (with interest upon
such principal and premium, if any, and, to the extent that such payment is
enforceable under applicable law, upon overdue installments of interest, at
the rate per annum expressed in the Securities of that series to the date of
such payment or deposit) and the amount payable to the Trustee under Section
7.06, and (ii) any and all Events of Default under the Indenture with respect
to such series, other than the nonpayment of principal on Securities of that
series that shall not have become due by their terms, shall have been
remedied or waived as provided in Section 6.06.
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No such rescission and annulment shall extend to or shall affect any
subsequent default or impair any right consequent thereon.
(d) In case the Trustee shall have proceeded to enforce any right
with respect to Securities of that series under this Indenture and such
proceedings shall have been discontinued or abandoned because of such
rescission or annulment or for any other reason or shall have been determined
adversely to the Trustee, then and in every such case the Company, the
Guarantor and the Trustee shall be restored respectively to their former
positions and rights hereunder, and all rights, remedies and powers of the
Company and the Trustee shall continue as though no such proceedings had been
taken.
SECTION 6.02. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.
(a) The Company and the Guarantor covenant that (1) in case it
shall default in the payment of any installment of interest on any of the
Securities of a series, or any payment required by any sinking or analogous
fund established with respect to that series as and when the same shall have
become due and payable, and such default shall have continued for a period of
90 Business Days, or (2) in case it shall default in the payment of the
principal of (or premium, if any, on) any of the Securities of a series when
the same shall have become due and payable, whether upon maturity of the
Securities of a series or upon redemption or upon declaration or otherwise,
then, upon demand of the Trustee, the Company or the Guarantor will pay to
the Trustee, for the benefit of the holders of the Securities of that series,
the whole amount that then shall have been become due and payable on all such
Securities for principal (and premium, if any) or interest, or both, as the
case may be, with interest upon the overdue principal (and premium, if any)
and (to the extent that payment of such interest is enforceable under
applicable law and, if the Securities are held by a MediaOne Trust or a
trustee of such trust, without duplication of any other amounts paid by the
Guarantor or such MediaOne Trust or trustee in respect thereof) upon overdue
installments of interest at the rate per annum expressed in the Securities of
that series; and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, and the amount
payable to the Trustee under Section 7.06.
(b) If the Company or the Guarantor shall fail to pay such amounts
forthwith upon such demand, the Trustee, in its own name and as trustee of an
express trust, shall be entitled and
35
empowered to institute any action or proceedings at law or in equity for the
collection of the sums so due and unpaid, and may prosecute any such action
or proceeding to judgment or final decree, and may enforce any such judgment
or final decree against the Company or the Guarantor or other obligor upon
the Securities of that series and collect the moneys adjudged or decreed to
be payable in the manner provided by law out of the property of the Company
or the Guarantor or other obligor upon the Securities of that series,
wherever situated.
(c) In case of any receivership, insolvency, liquidation,
bankruptcy, reorganization, readjustment, arrangement, composition or
judicial proceedings affected the Company or the Guarantor, or the creditors
or property of either, the Trustee shall have power to intervene in such
proceedings and take any action therein that may be permitted by the court
and shall (except as may be otherwise provided by law) be entitled to file
such proofs of claim and other papers and documents as may be necessary or
advisable in order to have the claims of the Trustee and of the holders of
Securities of such series allowed for the entire amount due and payable by
the Company or the Guarantor under the Indenture at the date of institution
of such proceedings and for any additional amount that may become due and
payable by the Company or the Guarantor after such date, and to collect and
receive any moneys or other property payable or deliverable on any such
claim, and to distribute the same after the deduction of the amount payable
to the Trustee under Section 7.06; and any receiver, assignee or trustee in
bankruptcy or reorganization is hereby authorized by each of the holders of
Securities of such series to make such payments to the Trustee, and, in the
event that the Trustee shall consent to the making of such payments directly
to such Securityholders, to pay to the Trustee any amount due it under
Section 7.06.
(d) All rights of action and of asserting claims under this
Indenture, or under any of the terms established with respect to Securities
of that series, may be enforced by the Trustee without the possession of any
of such Securities, or the production thereof at any trial or other
proceeding relative thereto, and any such suit or proceeding instituted by
the Trustee shall be brought in its own name as trustee of an express trust,
and any recovery of judgment shall, after provision for payment to the
Trustee of any amounts due under Section 7.06, be for the ratable benefit of
the holders of the Securities of such series.
In case of an Event of Default hereunder, the Trustee may in its
discretion proceed to protect and enforce the rights
36
vested in it by this Indenture by such appropriate judicial proceedings as
the Trustee shall deem most effectual to protect and enforce any of such
rights, either at law or in equity or in bankruptcy or otherwise, whether for
the specific enforcement of any covenant or agreement contained in the
Indenture or in aid of the exercise of any power granted in this Indenture,
or to enforce any other legal or equitable right vested in the Trustee by
this Indenture or by law.
Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting
the Securities of that series or the rights of any holder thereof or to
authorize the Trustee to vote in respect of the claim of any Securityholder
in any such proceeding.
SECTION 6.03. APPLICATION OF MONEYS COLLECTED.
Any moneys collected by the Trustee pursuant to this Article with
respect to a particular series of Securities shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of
the distribution of such moneys on account of principal (or premium, if any)
or interest, upon presentation of the Securities of that series, and notation
thereon the payment, if only partially paid, and upon surrender thereof if
fully paid:
FIRST: To the payment of costs and expenses of collection and
of all amounts payable to the Trustee under Section 7.06;
SECOND: To the payment of all Senior Indebtedness of the
Company if and to the extent required by Article Fourteen; and
THIRD: To the payment of the amounts then due and unpaid upon
Securities of such series for principal (and premium, if any) and
interest, in respect of which or for the benefit of which such money has
been collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Securities for
principal (and premium, if any) and interest, respectively.
SECTION 6.04. LIMITATION ON SUITS.
No holder of any Security of any series shall have any right by
virtue or by availing of any provision of this Indenture
37
to institute any suit, action or proceeding in equity or at law upon or under
or with respect to this Indenture or for the appointment of a receiver or
trustee, or for any other remedy hereunder, unless (i) such holder previously
shall have given to the Trustee written notice of an Event of Default and of
the continuance thereof with respect to the Securities of such series
specifying such Event of Default, as hereinbefore provided; (ii) the holders
of not less than 25% in aggregate principal amount of the Securities of such
series then Outstanding shall have made written request upon the Trustee to
institute such action, suit or proceeding in its own name as trustee
hereunder; (iii) such holder or holders shall have offered to the Trustee
such reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby; and (iv) the Trustee for 60
days after its receipt of such notice, request and offer of indemnity, shall
have failed to institute any such action, suit or proceeding and (v) during
such 60 day period, the holders of a majority in principal amount of the
Securities of that series do not give the Trustee a direction inconsistent
with the request.
Notwithstanding anything contained herein to the contrary, any other
provisions of this Indenture, the right of any holder of any Security to
receive payment of the principal of (and premium, if any) and interest on
such Security, as therein provided, on or after the respective due dates
expressed in such Security (or in the case of redemption, on the redemption
date), or to institute suit for the enforcement of any such payment on or
after such respective dates or redemption date, shall not be impaired or
affected without the consent of such holder and by accepting a Security
hereunder it is expressly understood, intended and covenanted by the taker
and holder of every Security of such series with every other such taker and
holder and the Trustee, that no one or more holders of Securities of such
series shall have any right in any manner whatsoever by virtue or by availing
of any provision of this Indenture to affect, disturb or prejudice the rights
of the holders of any other of such Securities, or to obtain or seek to
obtain priority over or preference to any other such holder, or to enforce
any right under this Indenture, except in the manner herein provided and for
the equal, ratable and common benefit of all holders of Securities of series.
For the protection and enforcement of the provisions of this Section, each
and every Securityholder and the Trustee shall be entitled to such relief as
can be given either at law or in equity.
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SECTION 6.05. RIGHTS AND REMEDIES CUMULATIVE; DELAY OR OMISSION
NOT WAIVER.
(a) Except as otherwise provided in Section 2.07, all powers and
remedies given by this Article to the Trustee or to the Securityholders
shall, to the extent permitted by law, be deemed cumulative and not exclusive
of any other powers and remedies available to the Trustee or the holders of
the Securities, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture or otherwise established with respect to such Securities.
(b) No delay or omission of the Trustee or of any holder of any of
the Securities to exercise any right or power accruing upon any Event of
Default occurring and continuing as aforesaid shall impair any such right or
power, or shall be construed to be a waiver of any such default or on
acquiescence therein; and, subject to the provisions of Section 6.04, every
power and remedy given by this Article or by law to the Trustee or the
Securityholders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Securityholders.
SECTION 6.06. CONTROL BY SECURITYHOLDERS.
The holders of a majority in aggregate principal amount of the
Securities of any series at the time Outstanding, determined in accordance
with Section 8.04, shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee with respect to such
series; PROVIDED, HOWEVER, that such direction shall not be in conflict with
any rule of law or with this Indenture or be unduly prejudicial to the rights
of holders of Securities of any other series at the time Outstanding
determined in accordance with Section 8.04. Subject to the provisions of
Section 7.01, the Trustee shall have the right to decline to follow any such
direction if the Trustee in good faith shall, by a Responsible Officer or
Officers of the Trustee, determine that the proceeding so directed would
involve the Trustee in personal liability. The holders of a majority in
aggregate principal amount of the Securities of any series at the time
Outstanding affected thereby, determined in accordance with Section 8.04, may
on behalf of the holders of all of the Securities of such series waive any
past default in the performance of any of the covenants contained herein or
established pursuant to Section 2.01 with respect to such series and its
consequences, except (i) a default in the payment of the
39
principal of, or premium, if any, or interest on, any of the Securities of
that series as and when the same shall become due by the terms of such
Securities otherwise than by acceleration (unless such default has been cured
and a sum sufficient to pay all matured installments of interest and
principal and any premium has been deposited with the Trustee (in accordance
with Section 6.01(c)) or (ii) a default in the covenants contained in Section
4.06. Upon any such waiver, the default covered thereby shall be deemed to
be cured for all purposes of this Indenture and the Company, the Trustee and
the holders of the Securities of such series shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other default or impair any right consequent
thereon.
SECTION 6.07. UNDERTAKING TO PAY COSTS.
All parties to this Indenture agree, and each holder of any
Securities by such holder's acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit
against the Trustee for any action taken or omitted by it as Trustee, the
filing by any party litigant in such suit of an undertaking to pay the costs
of such suit, and that such court may in its discretion assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in
such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; but the provisions of this Section
shall not apply to any suit instituted by the Trustee, to any suit instituted
by any Securityholder, or group of Securityholders, holding more than 10% in
aggregate principal amount of the Outstanding Securities of any series, or to
any suit instituted by any Securityholder for the enforcement of the payment
of the principal of (or premium, if any) or interest on any Security of such
series, on or after the respective due dates expressed in such Security or
established pursuant to this Indenture.
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ARTICLE VII.
CONCERNING THE TRUSTEE
SECTION 7.01. CERTAIN DUTIES AND RESPONSIBILITIES OF TRUSTEE.
(a) The Trustee, prior to the occurrence of an Event of Default
with respect to the Securities of a series and after the curing of all Events
of Default with respect to the Securities of that series that may have
occurred, shall undertake to perform with respect to the Securities of such
series such duties and only such duties as are specifically set forth in this
Indenture, and no implied covenants shall be read into this Indenture against
the Trustee. In case an Event of Default with respect to the Securities of a
series has occurred (that has not been cured or waived), the Trustee shall
exercise with respect to Securities of that series such of the rights and
powers vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
(b) No provision of this Indenture shall be construed to relieve
the Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(1) prior to the occurrence of an Event of Default with respect to the
Securities of a series and after the curing or waiving of all such Events of
Default with respect to that series that may have occurred:
(i) the duties and obligations of the Trustee shall with respect to
the Securities of such series be determined solely by the express
provisions of this Indenture, and the Trustee shall not be liable with
respect to the Securities of such series except for the performance of
such duties and obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read into
this Indenture against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee, the
Trustee may with respect to the Securities of such series conclusively
rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions furnished
to the Trustee and conforming to the
41
requirements of this Indenture; but in the case of any such certificates
or opinions that by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not they conform to the requirement of
this Indenture;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be proved that the Trustee, was negligent in ascertaining the
pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of
the holders of not less than a majority in principal amount of the Securities
of any series at the time Outstanding relating to the time, method and place
of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee under this Indenture
with respect to the Securities of that series; and
(4) None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any
of its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or liability is not reasonably assured to it under
the terms of this Indenture or adequate indemnity against such risk is not
reasonably assured to it.
SECTION 7.02. CERTAIN RIGHTS OF TRUSTEE.
Except as otherwise provided in Section 7.01:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
bond, security or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) Any request, direction, order or demand of the Company or the
Guarantor mentioned herein shall be sufficiently evidenced by a Board
Resolution or an instrument signed in the name of the Company or the
Guarantor, as the case may be, by the President or any Vice President and by
42
the Secretary or an Assistant Secretary or the Treasurer or an
Assistant Treasurer thereof (unless other evidence in respect thereof is
specifically prescribed herein);
(c) The Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered
or omitted hereunder in good faith and in reliance thereon;
(d) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders, pursuant to the provisions of
this Indenture, unless such Securityholders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that may be incurred therein or thereby; nothing contained
herein shall, however, relieve the Trustee of the obligation, upon the
occurrence of an Event of Default with respect to a series of the
Securities (that has not been cured or waived) to exercise with respect
to Securities of that series such of the rights and powers vested in it
by this Indenture, and to use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances
in the conduct of his own affairs;
(e) The Trustee shall not be liable for any action taken or omitted
to be taken by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Indenture;
(f) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
bond, security, or other papers or documents, unless requested in writing
so to do by the holders of not less than a majority in principal amount
of the Outstanding Securities of the particular series affected thereby
(determined as provided in Section 8.04); PROVIDED, HOWEVER, that if the
payment within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured
to the Trustee by the security afforded to it by the terms of this
Indenture, the Trustee may require reasonable indemnity against such
costs, expenses or liabilities as a condition to so proceeding.
43
The reasonable expense of every such examination shall be paid by the
Company and the Guarantor or, if paid by the Trustee, shall be repaid by
the Company and the Guarantor upon demand; and
(g) The Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents
or attorneys and the Trustee shall not be responsible for any misconduct
or negligence on the part of any agent or attorney appointed with due
care by it hereunder.
SECTION 7.03. TRUSTEE NOT RESPONSIBLE FOR RECITALS OR ISSUANCE
OR SECURITIES.
(a) The recitals contained herein and in the Securities shall be
taken as the statements of the Company and the Guarantor, and the Trustee
assumes no responsibility for the correctness of the same.
(b) The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Securities.
(c) The Trustee shall not be accountable for the use or application
by the Company or the Guarantor of any of the Securities or of the proceeds
of such Securities, or for the use or application of any moneys paid over by
the Trustee in accordance with any provision of this Indenture or established
pursuant to Section 2.01, or for the use or application of any moneys
received by any paying agent other than the Trustee.
SECTION 7.04. MAY HOLD SECURITIES.
The Trustee or any paying agent or Security Registrar, in its
individual or any other capacity, may become the owner or pledgee of
Securities with the same rights it would have if it were not Trustee, paying
agent or Security Registrar.
SECTION 7.05. MONEYS HELD IN TRUST.
Subject to the provisions of Section 11.05, all moneys received by
the Trustee shall, until used or applied as herein provided, be held in trust
for the purposes for which they were received, but need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any moneys received by it hereunder except
such as it may agree with the Company and the Guarantor to pay thereon.
44
SECTION 7.06. COMPENSATION AND REIMBURSEMENT.
(a) The Company and the Guarantor covenant and agree to pay to the
Trustee, and the Trustee shall be entitled to, such reasonable compensation
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust), as the Company, the Guarantor
and the Trustee may from time to time agree in writing, for all services
rendered by it in the execution of the trusts hereby created and in the
exercise and performance of any of the powers and duties hereunder of the
Trustee, and, except as otherwise expressly provided herein, the Company and
the Guarantor will pay or reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by the
Trustee in accordance with any of the provisions of this Indenture (including
the reasonable compensation and the expenses and disbursements of its counsel
and of all Persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence or bad faith. The
Company and the Guarantor also covenant to indemnify the Trustee (and its
officers, agents, directors and employees) for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or bad
faith on the part of the Trustee and arising out of or in connection with the
acceptance or administration of this trust, including the costs and expenses
of defending itself against any claim of liability in the premises.
(b) The obligations of the Company and the Guarantor under this
Section to compensate and indemnify the Trustee and to pay or reimburse the
Trustee for expenses, disbursements and advances shall constitute additional
indebtedness hereunder. Such additional indebtedness shall be secured by a
lien prior to that of the Securities upon all property and funds held or
collected by the Trustee as such, except funds held in trust for the benefit
of the holders of particular Securities.
SECTION 7.07. RELIANCE ON OFFICERS' CERTIFICATE.
Except as otherwise provided in Section 7.01, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking
or suffering or omitting to take any action hereunder, such matter (unless
other evidence in respect thereof be herein specifically prescribed) may, in
the absence of negligence or bad faith on the part of the Trustee, be deemed
to be conclusively proved and established by an Officers' Certificate
delivered to the Trustee and such certificate, in the absence of negligence
or bad faith on the part of the Trustee,
45
shall be full warrant to the Trustee for any action taken, suffered or
omitted to be taken by it under the provisions of this Indenture upon the
faith thereof.
SECTION 7.08. DISQUALIFICATION; CONFLICTING INTERESTS.
If the Trustee has or shall acquire any "conflicting interest"
within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee
and the Company shall in all respects comply with the provisions of Section
310(b) of the Trust Indenture Act.
SECTION 7.09. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
There shall at all times be a Trustee with respect to the Securities
issued hereunder which shall at all times be a corporation organized and
doing business under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a corporation or other
Person permitted to act as trustee by the Commission, authorized under such
laws to exercise corporate trust powers, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000), and subject to
supervision or examination by Federal, State, Territorial, or District of
Columbia authority. If such corporation publishes reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section,
the combined capital and surplus of such corporation shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. The Company and the Guarantor may not, nor may any
Person directly or indirectly controlling, controlled by, or under common
control with the Company or the Guarantor, serve as Trustee. In case at any
time the Trustee shall cease to be eligible in accordance with the provisions
of this Section, the Trustee shall resign immediately in the manner and with
the effect specified in Section 7.10.
SECTION 7.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) The Trustee or any successor hereafter appointed, may at any
time resign with respect to the Securities of one or more series by giving
written notice thereof to the Company and the Guarantor and by transmitting
notice of resignation by mail, first class postage prepaid, to the
Securityholders of such series, as their names and addresses appear upon the
Security Register. Upon receiving such notice of resignation, the Company
46
and the Guarantor shall promptly appoint a successor trustee with respect to
Securities of such series by written instrument, in duplicate, executed by
order of the Board of Directors, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the successor trustee. If
no successor trustee shall have been so appointed and have accepted
appointment within 30 days after the mailing of such notice of resignation,
the resigning Trustee may petition any court of competent jurisdiction for
the appointment of a successor trustee with respect to Securities of such
series, or any Securityholder of that series who has been a bona fide holder
of a Security or Securities for at least six months may, subject to the
provisions of Section 6.08, on behalf of himself and all others similarly
situated, petition any such court for the appointment of a successor trustee.
Such court may thereupon after such notice, if any, as it may deem proper
and prescribe, appoint a successor trustee.
(b) In case at any time any one of the following shall occur:
(1) the Trustee shall fail to comply with the provisions of
subsection (a) of Section 7.08 after written request therefor by the
Company or the Guarantor or by any Securityholder who has been a bona
fide holder of a Security or Securities for at least six months; or
(2) the Trustee shall cease to be eligible in accordance with the
provisions of Section 7.09 and shall fail to resign after written request
therefor by the Company or the Guarantor or by any such Securityholder; or
(3) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or commence a voluntary bankruptcy
proceeding, or a receiver of the Trustee or of its property shall be
appointed or consented to, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then, in any such case, the
Company or the Guarantor may remove the Trustee with respect to all
Securities and appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to
the successor trustee, or, subject to the provisions of Section 6.08,
unless the Trustee's duty to resign is stayed as provided herein, any
Securityholder who has been a bona fide holder of a Security or
Securities
47
for at least six months may, on behalf of that holder and all others
similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor trustee. Such
court may thereupon after such notice, if any, as it may deem proper and
prescribe, remove the Trustee and appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities of any series at the time Outstanding may at any time remove the
Trustee with respect to such series by so notifying the Trustee, the Company
and the Guarantor and may appoint a successor Trustee for such series with
the consent of the Company and the Guarantor.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee with respect to the Securities of a series pursuant to any
of the provisions of this Section shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 7.11.
(e) Any successor trustee appointed pursuant to this Section may be
appointed with respect to the Securities of one or more series or all of such
series, and at any time there shall be only one Trustee with respect to the
Securities of any particular series.
SECTION 7.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor trustee
with respect to all Securities, every such successor trustee so appointed
shall execute, acknowledge and deliver to the Company and the Guarantor and
to the retiring Trustee an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Trustee shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on the request of the Company or the
Guarantor or the successor trustee, such retiring Trustee shall, upon payment
of its charges, execute and deliver an instrument transferring to such
successor trustee all the rights, powers, and trusts of the retiring Trustee
and shall duly assign, transfer and deliver to such successor trustee all
property and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor trustee
with respect to the Securities of one or more (but not all) series, the
Company, the Guarantor, the retiring
48
Trustee and each successor trustee with respect to the Securities of one or
more series shall execute and deliver an indenture supplemental hereto
wherein each successor trustee shall accept such appointment and which (1)
shall contain such provisions as shall be necessary or desirable to transfer
and confirm to, and to vest in, each successor trustee all the rights,
powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
trustee relates, (2) shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and
duties of the retiring Trustee with respect to the Securities of that or
those series as to which the retiring Trustee is not retiring shall continue
to be vested in the retiring Trustee, and (3) shall add to or change any of
the provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one
Trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such Trustees co-trustees of the same trust, that
each such Trustee shall be trustee of a trust or trusts hereunder separate
and apart from any trust or trusts hereunder administered by any other such
Trustee and that no Trustee shall be responsible for any act or failure to
act on the part of any other Trustee hereunder; and upon the execution and
delivery of such supplemental indenture the resignation or removal of the
retiring Trustee shall become effective to the extent provided therein, such
retiring Trustee shall with respect to the Securities of that or those series
to which the appointment of such successor trustee relates have no further
responsibility for the exercise of rights and powers or for the performance
of the duties and obligations vested in the Trustee under this Indenture, and
each such successor trustee, without any further act, deed or conveyance,
shall become vested with all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series to
which the appointment of such successor trustee relates; but, on request of
the Company or the Guarantor or any successor trustee, such retiring Trustee
shall duly assign, transfer and deliver to such successor trustee, to the
extent contemplated by such supplemental indenture, the property and money
held by such retiring Trustee hereunder with respect to the Securities of
that or those series to which the appointment of such successor trustee
relates.
(c) Upon request of any such successor trustee, the Company and the
Guarantor shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor trustee all such rights, powers
and trusts referred to in paragraph (a) or (b) of this Section, as the case
may be.
49
(d) No successor trustee shall accept its appointment unless
at the time of such acceptance such successor trustee shall be qualified and
eligible under this Article.
(e) Upon acceptance of appointment by a successor trustee as
provided in this Section, the Company and the Guarantor shall transmit notice
of the succession of such trustee hereunder by mail, first class postage
prepaid, to the Securityholders, as their names and addresses appear upon the
Security Register. If the Company and the Guarantor fail to transmit such
notice within ten days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be transmitted at
the expense of the Company and the Guarantor.
SECTION 7.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION
TO BUSINESS.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to the corporate trust business of the Trustee,
shall be the successor of the Trustee hereunder, PROVIDED that such
corporation shall be qualified under the provisions of Section 7.08 and
eligible under the provisions of Section 7.09, without the execution or
filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding. In case any
Securities shall have been authenticated, but not delivered, by the Trustee
then in office, any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver the
Securities so authenticated with the same effect as if such successor Trustee
had itself authenticated such Securities.
SECTION 7.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.
The Trustee shall comply with Section 311(a) of the Trust Indenture
Act, excluding any creditor relationship described in Section 311(b) of the
Trust Indenture Act. A Trustee who has resigned or been removed shall be
subject to Section 311(a) of the Trust Indenture Act to the extent included
therein.
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ARTICLE VIII.
CONCERNING THE SECURITYHOLDERS
SECTION 8.01. EVIDENCE OF ACTION BY SECURITYHOLDERS.
Whenever in this Indenture it is provided that the holders of a
majority or specified percentage in aggregate principal amount of the
Securities of a particular series may take any action (including the making
of any demand or request, the giving of any notice, consent or waiver or the
taking of any other action), the fact that at the time of taking any such
action the holders of such majority or specified percentage of that series
have joined therein may be evidenced by any instrument or any number of
instruments of similar tenor executed by such holders of Securities of that
series in Person or by agent or proxy appointed in writing.
If the Company or the Guarantor shall solicit from the
Securityholders of any series any request, demand, authorization, direction,
notice, consent, waiver or other action, the Company or the Guarantor may, at
its option, as evidenced by an Officers' Certificate, fix in advance a record
date for such series for the determination of Securityholders entitled to
give such request, demand, authorization, direction, notice, consent, waiver
or other action, but the Company or the Guarantor shall have no obligation to
do so. If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other action may be given before or
after the record date, but only the Securityholders of record at the close of
business on the record date shall be deemed to be Securityholders for the
purposes of determining whether Securityholders of the requisite proportion
of Outstanding Securities of that series have authorized or agreed or
consented to such request, demand, authorization, direction, notice, consent,
waiver or other action, and for that purpose the Outstanding Securities of
that series shall be computed as of the record date; PROVIDED, HOWEVER, that
no such authorization, agreement or consent by such Securityholders on the
record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after
the record date.
SECTION 8.02. PROOF OF EXECUTION BY SECURITYHOLDERS.
Subject to the provisions of Section 7.01, proof of the execution of
any instrument by a Securityholder (such proof will not require notarization)
or his agent or proxy and proof of the
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holding by any Person of any of the Securities shall be sufficient if made in
the following manner:
(a) The fact and date of the execution by any such Person of any
instrument may be proved in any reasonable manner acceptable to the Trustee.
(b) The ownership of Securities shall be proved by the Security
Register of such Securities or by a certificate of the Security Registrar
thereof.
(c) The Trustee may require such additional proof of any matter
referred to in this Section as it shall deem necessary.
SECTION 8.03. WHO MAY BE DEEMED OWNERS.
Prior to the due presentment for registration of transfer of any
Security, the Company, the Guarantor, the Trustee, any paying agent and any
Security Registrar may deem and treat the Person in whose name such Security
shall be registered upon the books of the Company as the absolute owner of
such Security (whether or not such Security shall be overdue and
notwithstanding any notice of ownership or writing thereon made by anyone
other than the Security Registrar) for the purpose of receiving payment of or
on account of the principal of, premium, if any, and (subject to Section
2.03) interest on such Security and for all other purposes; and neither the
Company nor the Guarantor nor the Trustee nor any paying agent nor any
Security Registrar shall be affected by any notice to the contrary.
SECTION 8.04. CERTAIN SECURITIES OWNED BY COMPANY OR GUARANTOR
DISREGARDED.
In determining whether the holders of the requisite aggregate
principal amount of Securities of a particular series have concurred in any
direction, consent of waiver under this Indenture, the Securities of that
series that are owned by the Company or the Guarantor or any other obligor on
the Securities of that series or by any Person directly or indirectly
controlling or controlled by or under common control with the Company or the
Guarantor or any other obligor on the Securities of that series shall be
disregarded and deemed not to be Outstanding for the purpose of any such
determination, except that for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, consent or waiver, only
Securities of such series that the Trustee actually knows are so owned shall
be so disregarded. The Securities so owned
52
that have been pledged in good faith may be regarded as Outstanding for the
purposes of this Section, if the pledgee shall establish to the satisfaction
of the Trustee the pledgee's right so to act with respect to such Securities
and that the pledgee is not a Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or
the Guarantor or any such other obligor. In case of a dispute as to such
right, any decision by the Trustee taken upon the advice of counsel shall be
full protection to the Trustee.
SECTION 8.05. ACTIONS BINDING ON FUTURE SECURITYHOLDERS.
At any time prior to (but not after) the evidencing to the Trustee,
as provided in Section 8.01, of the taking of any action by the holders of
the majority or percentage in aggregate principal amount of the Securities of
a particular series specified in this Indenture in connection with such
action, any holder of a Security of that series that is shown by the evidence
to be included in the Securities the holders of which have consented to such
action may, by filing written notice with the Trustee, and upon proof of
holding as provided in Section 8.02, revoke such action so far as concerns
such Security. Except as aforesaid any such action taken by the holder of any
Security shall be conclusive and binding upon such holder and upon all future
holders and owners of such Security, and of any Security issued in exchange
therefor, on registration of transfer thereof or in place thereof,
irrespective of whether or not any notation in regard thereto is made upon
such Security. Any action taken by the holders of the majority or percentage
in aggregate principal amount of the Securities of a particular series
specified in this Indenture in connection with such action shall be
conclusively binding upon the Company, the Guarantor, the Trustee and the
holders of all the Securities of that series.
ARTICLE IX.
SUPPLEMENTAL INDENTURES
SECTION 9.01. SUPPLEMENTAL INDENTURES WITHOUT THE CONSENT OF
SECURITYHOLDERS.
In addition to any supplemental indenture otherwise authorized by
this Indenture, the Company and the Guarantor and the Trustee may from time
to time and at any time enter into an indenture or indentures supplemental
hereto (which shall conform to the provisions of the Trust Indenture Act as
then in effect),
53
without the consent of the Securityholders, for one or more of the following
purposes:
(a) to cure any ambiguity, defect, or inconsistency herein, in the
Securities of any series or in the Guarantees;
(b) to comply with Article Ten;
(c) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(d) to add to the covenants of the Company or the Guarantor for the
benefit of the holders of all or any Series of Securities (and if such
covenants are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included solely for the
benefit of such series) or to surrender any right or power herein conferred
upon the Company or the Guarantor;
(e) to add to, delete from, or revise the conditions, limitations,
and restrictions on the authorized amount, terms, or purposes of issue,
authentication, and delivery of Securities, as herein set forth;
(f) to make any change that does not adversely affect the rights of
any Securityholder in any material respect; or
(g) to provide for the issuance of and establish the form and terms
and conditions of the Securities of any series and the Guarantees as provided
in Section 2.01, to establish the form of any certifications required to be
furnished pursuant to the terms of this Indenture or any series of
Securities, or to add to the rights of the holders of any series of
Securities.
The Trustee is hereby authorized to join with the Company and the
Guarantor in the execution of any such supplemental indenture, and to make
any further appropriate agreements and stipulations that may be therein
contained, but the Trustee shall not be obligated to enter into any such
supplemental indenture that affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this
Section may be executed by the Company, the Guarantor and the Trustee without
the consent of the holders of any of the Securities at the time Outstanding,
notwithstanding any of the provisions of Section 9.02.
54
SECTION 9.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF SECURITYHOLDERS.
With the consent (evidenced as provided in Section 8.01) of the
holders of not less than a majority in aggregate principal amount of the
Securities of each series affected by such supplemental indenture or
indentures at the time Outstanding, the Company and the Guarantor, when
authorized by Board Resolutions, and the Trustee may from time to time and at
any time enter into an indenture or indentures supplemental hereto (which
shall conform to the provisions of the Trust Indenture Act as then in effect)
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of any supplemental
indenture or of modifying in any manner not covered by Section 9.01 the
rights of the holders of the Securities of such series under this Indenture;
PROVIDED, HOWEVER, that no such supplemental indenture shall, without the
consent of the holders of each Security then Outstanding and affected
thereby, (i) extend the fixed maturity of any Securities of any series, or
reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, or reduce any premium payable upon the
redemption thereof or (ii) reduce the aforesaid percentage of Securities, the
holders of which are required to consent to any such supplemental indenture.
It shall not be necessary for the consent of the Securityholders of
any series affected thereby under this Section to approve the particular form
of any proposed supplemental indenture, but it shall be sufficient if such
consent shall approve the substance thereof.
SECTION 9.03. EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture pursuant to the
provisions of this Article or of Section 10.01, this Indenture shall, with
respect to such series, be and be deemed to be modified and amended in
accordance therewith and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of the Trustee, the
Company, the Guarantor and the holders of Securities of the series affected
thereby shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments, and all the
terms and conditions of any such supplemental indenture shall be and be
deemed to be part of the terms and conditions of this Indenture for any and
all purposes.
55
SECTION 9.04. SECURITIES AFFECTED BY SUPPLEMENTAL INDENTURES.
Securities of any series, affected by a supplemental indenture,
authenticated and delivered after the execution of such supplemental
indenture pursuant to the provisions of this Article or of Section 10.01, may
bear a notation in form approved by the Company, provided such form meets the
requirements of any exchange upon which such series may be listed, as to any
matter provided for in such series may be listed, as to any matter provided
for in such supplemental indenture. If the Company and the Guarantor shall
so determine, new Securities of that series so modified as to conform, in the
opinion of the Board of Directors of the Company and the Guarantor, to any
modification of this Indenture contained in any such supplemental indenture
may be prepared by the Company and the Guarantor, authenticated by the
Trustee and delivered in exchange for the Securities of that series then
Outstanding.
SECTION 9.05. EXECUTION OF SUPPLEMENTAL INDENTURES.
Upon the request of the Company and the Guarantor, accompanied by
their Board Resolutions authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of the consent of
Securityholders required to consent thereto as aforesaid, the Trustee shall
join with the Company and the Guarantor in the execution of such supplemental
indenture unless such supplemental indenture affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion but shall not be obligated to enter into
such supplemental indenture. The Trustee, subject to the provisions of
Section 7.01, may receive an Opinion of Counsel as conclusive evidence that
any supplemental indenture executed pursuant to this Article is authorized or
permitted by, and conforms to, the terms of this Article and that it is
proper for the Trustee under the provisions of this Article to join in the
execution thereof; PROVIDED, HOWEVER, that such Opinion of Counsel need not
be provided in connection with the execution of a supplemental indenture that
establishes the terms of a series of Debt Securities and related Guarantee
pursuant to Section 2.01 hereof.
Promptly after the execution by the Company, the Guarantor and the
Trustee of any supplemental indenture pursuant to the provisions of this
Section, the Trustee shall transmit by mail, first class postage prepaid, a
notice, setting forth in general terms the substance of such supplemental
indenture, to the Securityholders of all series affected thereby as their
names
56
and addresses appear upon the Security Register. Any failure of the Trustee
to mail such notice, or any defect therein, shall not, however, in any way
impair or affect the validity of any such supplemental indenture.
ARTICLE X.
SUCCESSOR CORPORATION
SECTION 10.01. COMPANY OR GUARANTOR MAY CONSOLIDATE, ETC.
Nothing contained in this Indenture or in any of the Securities
shall prevent any consolidation or merger of the Company or the Guarantor
with or into any other corporation or corporations (whether or not affiliated
with the Company or the Guarantor, as the case may be), or successive
consolidations or mergers in which the Company or the Guarantor, as the case
may be, or its successor or successors shall be a party or parties, or shall
prevent any sale, conveyance, transfer or other disposition of the property
of the Company or the Guarantor, as the case may be, or its successor or
successors as an entirety, or substantially as an entirety, to any other
corporation (whether or not affiliated with the Company or the Guarantor, as
the case may be, or its successor or successors) authorized to acquire and
operate the same; PROVIDED, HOWEVER, the Company and the Guarantor hereby
covenant and agree that, upon any such consolidation, merger, sale,
conveyance, transfer or other disposition, the due and punctual payment, in
the case of the Company, of the principal of (premium, if any) and interest
on all of the Debt Securities of all series in accordance with the terms of
each series, according to their tenor or, in the case of the Guarantor, the
performance of all obligations under the Guarantees, and the due and punctual
performance and observance of all the covenants and conditions of this
Indenture with respect to each series or established with respect to such
series pursuant to Section 2.01 to be kept or performed by the Company or the
Guarantor, as the case may be, shall be expressly assumed, by supplemental
indenture (which shall conform to the provisions of the Trust Indenture Act,
as then in effect) satisfactory in form to the Trustee executed and delivered
to the Trustee by the entity formed by such consolidation, or into which the
Company or the Guarantor, as the case may be, shall have been merged, or by
the entity which shall have acquired such property.
Notwithstanding anything to the contrary contained in this
Indenture, the provisions of this Section 10.01 shall not
57
apply to the distribution by the Guarantor to its stockholders of the capital
stock of USW-C, Inc., a Delaware corporation ("New U S WEST"), pursuant to
the terms of the Separation Agreement, dated as of June 5, 1998, as amended
from time to time, between the Guarantor and New U S WEST.
SECTION 10.02. SUCCESSOR CORPORATION SUBSTITUTED.
(a) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition and upon the assumption by the successor
corporation, by supplemental indenture, executed and delivered to the Trustee
and satisfactory in form to the Trustee, of, in the case of the Company, the
due and punctual payment of the principal of, premium, if any, and interest
on all of the Debt Securities of all series Outstanding or, in the case of
the Guarantor, the performance of all obligations under the Guarantees, and
the due and punctual performance of all of the covenants and conditions of
this Indenture or established with respect to each series of the Securities
pursuant to Section 2.01 to be performed by the Company or the Guarantor, as
the case may be, with respect to each series, such successor corporation
shall succeed to and be substituted for the Company or the Guarantor, as the
case may be, with the same effect as if it had been named as the Company or
the Guarantor, as the case may be, herein, and thereupon the predecessor
corporation shall be relieved of all obligations and covenants under this
Indenture and the Securities.
(b) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition such changes in phraseology and form (but not
in substance) may be made in the Securities thereafter to be issued as may be
appropriate.
(c) Nothing contained in this Indenture or in any of the Securities
shall prevent the Company or the Guarantor from merging into itself or
acquiring by purchase or otherwise all or any part of the property of any
other Person (whether or not affiliated with the Company or the Guarantor).
SECTION 10.03. EVIDENCE OF CONSOLIDATION, ETC. TO TRUSTEE.
The Trustee, subject to the provisions of Section 7.01, may receive
an Opinion of Counsel as conclusive evidence that any such consolidation,
merger, sale, conveyance, transfer or other disposition, and any such
assumption, comply with the provisions of this Article.
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ARTICLE XI.
SATISFACTION AND DISCHARGE
SECTION 11.01. SATISFACTION AND DISCHARGE OF INDENTURE.
If at any time: (a) the Company or the Guarantor shall have
delivered to the Trustee for cancellation all Securities of a series
theretofore authenticated (other than any Securities that shall have ben
destroyed, lost or stolen and that shall have been replaced or paid as
provided in Section 2.07) and Securities for whose payment money or
Governmental Obligations have theretofore been deposited in trust or
segregated and held in trust by the Company or the Guarantor (and thereupon
repaid to the Company or the Guarantor or discharged from such trust, as
provided in Section 11.05); or (b) all such Securities of a particular series
not theretofore delivered to the Trustee for cancellation shall have become
due and payable, or are by their terms to become due and payable within one
year or are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption, and the
Company or the Guarantor shall deposit or cause to be deposited with the
Trustee as trust funds the entire amount in moneys or Governmental
Obligations sufficient or a combination thereof, sufficient in the opinion of
a nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay at maturity or
upon redemption all Securities of that series not theretofore delivered to
the Trustee for cancellation, including principal (and premium, if any) and
interest due or to become due to such date of maturity or date fixed for
redemption, as the case may be, and if the Company or the Guarantor shall
also pay or cause to be paid all other sums payable hereunder with respect to
such series by the Company and the Guarantor; then this Indenture shall
thereupon cease to be of further effect with respect to such series except
for the provisions of Sections 2.03, 2.05, 2.07, 4.01, 4.02, 4.03 and 7.10,
that shall survive until the date of maturity or redemption date, as the case
may be, and Sections 7.06 and 11.05, that shall survive to such date and
thereafter, and the Trustee, on demand of the Company and the Guarantor and
at the cost and expense of the Company and the Guarantor, shall execute
proper instruments acknowledging satisfaction of and discharging this
Indenture with respect to such series.
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SECTION 11.02. DISCHARGE OF OBLIGATIONS.
If at any time all such Securities of a particular series not
heretofore delivered to the Trustee for cancellation or that have not become
due and payable as described in Section 11.01 shall have been paid by the
Company or the Guarantor by depositing irrevocably with the Trustee as trust
funds moneys or an amount of Governmental Obligations sufficient to pay at
maturity or upon redemption all such Securities of that series not
theretofore delivered to the Trustee for cancellation, including principal
(and premium, if any) and interest due or to become due to such date of
maturity or date fixed for redemption, as the case may be, and if the Company
or the Guarantor shall also pay or cause to be paid all other sums payable
hereunder by the Company and the Guarantor with respect to such series, then
after the date such moneys or Governmental Obligations, as the case may be,
are deposited with the Trustee the obligations of the Company and the
Guarantor under this Indenture with respect to such series shall cease to be
of further effect except for the provisions of Sections 2.03, 2.05, 2.07,
4,01, 4.02, 4,03, 7.06, 7.10 and 11.05 hereof that shall survive until such
Securities shall mature and be paid. Thereafter, Sections 7.06 and 11.05
shall survive.
SECTION 11.03. DEPOSITED MONEYS TO BE HELD IN TRUST.
All moneys or Governmental Obligations deposited with the Trustee
pursuant to Sections 11.01 or 11.02 shall be held in trust and shall be
available for payment as due, either directly or through any paying agent
(including the Company acting as its own paying agent), to the holders of the
particular series of Securities for the payment or redemption of which such
moneys or Governmental Obligations have been deposited with the Trustee.
SECTION 11.04. PAYMENT OF MONEYS HELD BY PAYING AGENTS.
In connection with the satisfaction and discharge of this Indenture
all moneys or Governmental Obligations then held by any paying agent under
the provisions of this Indenture shall, upon demand of the Company or the
Guarantor, be paid to the Trustee and thereupon such paying agent shall be
released from all further liability with respect to such moneys or
Governmental Obligations.
SECTION 11.05. REPAYMENT TO COMPANY.
Any moneys or Governmental Obligations deposited with any paying
agent or the Trustee, or then held by the Company or
60
the Guarantor, as the case may be, in trust for payment of principal of or
premium or interest on the Securities of a particular series that are not
applied but remain unclaimed by the holders of such Securities for at least
two years after the date upon which the principal of (and premium, if any) or
interest on such Securities shall have respectively become due and payable,
shall be repaid to the Company or the Guarantor, as the case may be, on May
31 of each year or (if then held by the Company or the Guarantor) shall be
discharged from such trust; and thereupon the paying agent and the Trustee
shall be released from all further liability with respect to such moneys or
Governmental Obligations, and the holder of any of the Securities entitled to
receive such payment shall thereafter, as an unsecured general creditor, look
only to the Company or the Guarantor for the payment thereof.
ARTICLE XII.
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS
SECTION 12.01. NO RECOURSE.
No recourse under or upon any obligation, covenant or agreement of
this Indenture, or of any Security or Guarantee, or for any claim based
thereon or otherwise in respect thereof, shall be had against any
incorporator, stockholder, officer or director, past, present or future as
such, of the Company or the Guarantor or of any predecessor or successor
corporation, either directly or through the Company or the Guarantor or any
such predecessor or successor corporation, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise; it being expressly understood that this Indenture
and the obligations issued hereunder are solely corporate obligations, and
that no such personal liability whatever shall attach to, or is or shall be
incurred by, the incorporators, stockholders, officers or directors as such,
of the Company or the Guarantor or of any predecessor or successor
corporation, or any of them, because of the creation of the indebtedness
hereby authorized, or under or by reason of the obligations, covenants or
agreements contained in this Indenture or in any of the Securities or implied
therefrom; and that any and all such personal liability of every name and
nature, either at common law or in equity or by constitution or statute, of,
and any and all such rights and claims against, every such incorporator,
stockholder, officer or director as such, because of the creation of the
indebtedness
61
hereby authorized, or under or by reason of the obligations, covenants or
agreements contained in this Indenture or in any of the Securities or implied
therefrom, are hereby expressly waived and released as a condition of, and as
a consideration for, the execution of this Indenture and the issuance of such
Securities.
ARTICLE XIII.
MISCELLANEOUS PROVISIONS
SECTION 13.01. EFFECT ON SUCCESSORS AND ASSIGNS.
All the covenants, stipulations, promises and agreements in this
Indenture contained by or on behalf of the Company or the Guarantor shall
bind their respective successors and assigns, whether so expressed or not.
SECTION 13.02. ACTIONS BY SUCCESSOR.
Any act or proceeding by any provision of this Indenture authorized
or required to be done or performed by any board, committee or officer of the
Company or the Guarantor shall and may be done and performed with like force
and effect by the corresponding board, committee or officer of any
corporation that shall at the time be the lawful sole successor of the
Company or the Guarantor, as the case may be.
SECTION 13.03. SURRENDER OF COMPANY POWERS.
The Company or the Guarantor by instrument in writing executed by
authority of 2/3 (two-thirds) of its Board of Directors and delivered to the
Trustee may surrender any of the powers reserved to the Company or the
Guarantor, as the case may be, and thereupon such power so surrendered shall
terminate both as to the Company or the Guarantor, as the case may be, and as
to any successor corporation.
SECTION 13.04. NOTICES.
Except as otherwise expressly provided herein any notice or demand
that by any provision of this Indenture is required or permitted to be given
or served by the Trustee or by the holders of Securities to or on the Company
or the Guarantor may be given or served by being deposited first class
postage prepaid in a post-office letterbox addressed (until another address
is filed in writing by the Company with the Trustee), as follows: c/o U S
WEST, Inc. (to be renamed "MediaOne Group,
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Inc."), ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Treasurer. Any notice, election, request or demand by the Company or any
Securityholder to or upon the Trustee shall be deemed to have been
sufficiently given or made, for all purposes, if given or made in writing at
the Corporate Trust Office of the Trustee.
SECTION 13.05. GOVERNING LAW.
This Indenture and each Security shall be deemed to be a contract
made under the internal laws of the State of New York, and for all purposes
shall be construed in accordance with the laws of said State.
SECTION 13.06. TREATMENT OF DEBT SECURITIES AS DEBT.
It is intended that the Debt Securities will be treated as
indebtedness and not as equity for federal income tax purposes. The
provisions of this Indenture shall be interpreted to further this intention.
SECTION 13.07. COMPLIANCE CERTIFICATES AND OPINIONS.
(a) Upon any application or demand by the Company or the Guarantor
to the Trustee to take any action under any of the provisions of this
Indenture, the Company or the Guarantor, as the case may be, shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent
provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent have been complied with, except that in
the case of any such application or demand as to which the furnishing of such
documents is specifically required by any provision of this Indenture
relating to such particular application or demand, no additional certificate
or opinion need be furnished.
(b) Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or
covenant in this Indenture shall include (1) a statement that the Person
making such certificate or opinion has read such covenant or condition; (2) a
brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based; (3) a statement that, in the opinion of
such Person, he has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such covenant
or condition has been complied with;
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and (4) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been complied with.
SECTION 13.08. PAYMENTS ON BUSINESS DAYS.
Except as provided pursuant to Section 2.01 pursuant to a Board
Resolution, and as set forth in an Officers' Certificate, or established in
one or more indentures supplemental to this Indenture, in any case where the
date of maturity of interest or principal of any Security or the date of
redemption of any Security shall not be a Business Day, then payment of
interest or principal (and premium, if any) may be made on the next
succeeding Business Day with the same force and effect as if made on the
nominal date of maturity or redemption, and no interest shall accrue for the
period after such nominal date.
SECTION 13.09. CONFLICT WITH TRUST INDENTURE ACT.
If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
SECTION 13.10. COUNTERPARTS.
This Indenture may be executed in any number of counterparts, each
of which shall be an original, but such counterparts shall together
constitute but one and the same instrument.
SECTION 13.11. SEPARABILITY.
In case any one or more of the provisions contained in this
Indenture or in the Securities of any series shall for any reason be held to
be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provisions of this
Indenture or of such Securities, but this Indenture and such Securities shall
be construed as if such invalid or illegal or unenforceable provision had
never been contained herein or therein.
SECTION 13.12. ASSIGNMENT.
Each of the Company and the Guarantor will have the right at all
times to assign any of its respective rights or obligations under this
Indenture to a direct or indirect wholly-owned Subsidiary of the Guarantor,
PROVIDED that, in the event of any such assignment, the Company or the
Guarantor, as the case
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may be, will remain liable for all such obligations. Subject to the
foregoing, the Indenture is binding upon and inures to the benefit of the
parties thereto and their respective successors and assigns. This Indenture
may not otherwise be assigned by the parties thereto.
SECTION 13.13. ACKNOWLEDGEMENT OF RIGHTS.
The Company and the Guarantor acknowledge that, with respect to any
Securities held by a MediaOne Trust or a trustee of such trust, if the
Property Trustee of such Trust fails to enforce its rights under this
Indenture as the holder of the series of Securities held as the assets of
such MediaOne Trust, any holder of Preferred Securities of such MediaOne
Trust may, after a period of 30 days has elapsed from such holder's written
request to such Property Trustee to enforce such rights, institute legal
proceedings directly against the Company and the Guarantor to enforce such
Property Trustee's rights under this Indenture without first instituting any
legal proceedings against such Property Trustee or any other person or
entity. In addition, the Company and the Guarantor acknowledge that,
notwithstanding the foregoing, if a an event of default under the Declararion
of such MediaOne Trust has occurred and is continuing and such event is
attributable to the failure of the Company or the Guarantor to pay interest
or principal on such Securities on the date such interest or principal is
otherwise payable (or in the case of redemption, on the redemption date),
then any holder of such Preferred Securities may institute a proceeding for
enforcement of payment to such holder of the principal of, or interest on, an
aggregate principal amount of such Securities equal to the aggregate
liquidation amount of the Preferred Securities of such holder on or after the
respective due date specified in such Securities.
ARTICLE XIV.
SUBORDINATION OF SECURITIES
SECTION 14.01. SUBORDINATION TERMS.
The payment by the Company of the principal of, premium, if any, and
interest on any series of Debt Securities issued hereunder shall be
subordinated to the extent set forth in an indenture supplemental hereto
relating to such Debt Securities. The payment by the Guarantor of any
obligation due under any Guarantees issued hereunder shall be subordinated to
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the extent set forth in an indenture supplemental hereto relating to such
Guarantees.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed all as of the day and year first above written.
MEDIAONE GROUP FUNDING, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary
U S WEST, INC. (to be renamed
"MediaOne Group, Inc.")
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Secretary
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Trustee
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Corporate Trust Officer
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